nep-pol New Economics Papers
on Positive Political Economics
Issue of 2024‒03‒11
fourteen papers chosen by
Eugene Beaulieu, University of Calgary

  1. Political Competition and Strategic Voting in Multi-Candidate Elections By Bernhardt, Dan; Stefan Krasa, Stefan; Squintani, Francesco
  2. The Changing Polarization of Party Ideologies: The Role of Sorting By Satyajit Chatterjee; Burcu Eyigungor
  3. Campaigning Against Populism Emotions and Information in Real Election Campaigns By Cesi Cruz; Julien Labonne; Francesco Trebbi
  4. Issue Salience and Women’s Electoral Performance: Theory and Evidence from Google Trends By Michela Cella; Elena Manzoni; Francesco Scervini
  5. On the edge: Delays in election results and electoral violence in Sub-Sahara Africa By Saibu, Ghadafi
  6. Market Democracy, Rising Populism, and Contemporary Ordoliberalism By Malte Dold; Tim Krieger
  7. Populists at work. Italian municipal finance under M5s governments. By Massimo Bordignon; Tommaso Colussi; Francesco Porcelli
  8. Misinformation technology: Internet use and political misperceptions in Africa By Joël Cariolle; Yasmine Elkhateeb; Mathilde Maurel
  9. The Interaction of Economic and Political Inequality in Latin America By Fergusson, Leopoldo; Robinson, James; Torres, Santiago
  10. Geopolitics and International Trade: The Democracy Advantage By Mr. Serhan Cevik
  11. Are global value chains for sale? On business-state relations in the MENA region By Aboushady, Nora; Zaki, Chahir
  13. Pre-election communication in public good games with endogenous leaders By Lisa Bruttel; Gerald Eisenkopf; Juri Nithammer
  14. How Relevant is the Gandhian Political Economy for Today’s India? By Karmakar, Asim K.; Jana, Sebak Kumar

  1. By: Bernhardt, Dan (Department of Economics, University of Illinois and Department of Economics, University of Warwick); Stefan Krasa, Stefan (Department of Economics, University of Illinois); Squintani, Francesco (Department of Economics, University of Warwick)
    Abstract: We develop a model of strategic voting in a spatial setting with multiple candidates when voters have both expressive and instrumental concerns. The model endogenizes the strategic coordination of voters, yet is flexible enough to allow the analysis of political platform competition by policy-motivated candidates. We characterize all strategic voting equilibria in a three-candidate setting. Highlighting the utility of our approach, we analyze a setting with two mainstream and a spoiler candidate, showing that the spoiler can gain from entering, even though she has no chance of winning the election and reduces the winning probability of her preferred mainstream candidate
    Date: 2024
  2. By: Satyajit Chatterjee; Burcu Eyigungor
    Abstract: Ideology scores derived from U.S. congressional roll-call voting patterns show that the ideological distance between the two parties along the primary dimension changes inversely with the ideological distance along the secondary dimension. To explain this inverse association, a model of party competition with endogenous party membership and a two-dimensional ideology space is developed. If the distribution of voter preferences is uniform on a disk, equilibrium ideological distances along the two dimensions are inversely related. The model can quantitatively account for the historical movements in ideological distances as a function of changes in the ideological orientation of the two parties.
    Keywords: polarization; primaries; partisan sorting; political economy
    JEL: D72 P16
    Date: 2024–02
  3. By: Cesi Cruz; Julien Labonne; Francesco Trebbi
    Abstract: Populist politicians have leveraged direct connections with voters to win elections worldwide, often using emotional rather than policy appeals. Do these forms of campaigning work for programmatic politicians as well? We partner with a mainstream opposition political party to implement a field experiment during the 2019 Philippine Senatorial election to test the effectiveness of: (i) direct in-person appeals providing policy information; (ii) the addition of an activity designed to engender positive emotion. We show that direct engagement providing policy information increases vote share for the party, even in a clientelistic context. Additionally, while the emotional activity increases engagement with the campaign in the short term, the information-only treatment was more effective. Last, we present evidence that the treatments operated through learning and persuasion channels: treated voters were more likely to know the party, more certain about their knowledge, and gave higher ratings to the party’s quality and proposed policies.
    JEL: D7 D73 P0
    Date: 2024–02
  4. By: Michela Cella; Elena Manzoni; Francesco Scervini
    Abstract: In this paper we study whether and how the belief that the gender of politicians affects their competence on different issues influences electoral outcomes depending on the salience of those issues. We first propose a theoretical model of issue-specific gender bias in elections which can describe both the presence of a real comparative advantage (‘kernel-of-truth’ case, or stereotype) and the case of pure prejudice. We show that, if the bias exists, it influences electoral results and that its effect can be partially reversed by successful information transmission during the electoral campaign. We then empirically investigate the relation between issue salience and women’s performance using US data on House and Senate elections. Estimates of issue salience are obtained using Google Trends data. Exploiting the longitudinal dimension of the dataset at district level and an IV strategy to rule out possible endogeneity, we show a positive correlation between the salience of those issues that are typically listed as feminine and women’s electoral outcomes. We therefore conclude that a bias indeed exists. The average effect of the bias is sizable with respect to the share of votes for women candidates, even if not large enough to significantly increase the probability that women candidates win elections.
    Keywords: gender bias, elections, female politicians
    JEL: D72 J16
    Date: 2024
  5. By: Saibu, Ghadafi
    Abstract: Does the length of time passing between elections and the announcement of elections results increase the risk of post-election violence? The declaration of official election results is a crucial moment in the electoral cycle. When electoral management bodies (EMBs) take longer than expected to announce official election results, it can signal to the opposition that the election is being stolen. Following this logic, this paper argues that the length of time between elections and the announcement of the official results acts as a signal of possible voter fraud, thereby increasing incentives for post-election violence. Hence, the paper hypothesises that a long length of time between elections and the announcement of official results increases the risk of post-election violence. This hypothesis is examined with an original dataset of election results declarations in African countries from 1997 to 2022. After controlling for important confounders that could influence delays in reporting and violence, the article empirically demonstrates that a longer length of time between elections and the announcement of official election results increases the risk of post-election violence. In doing so, this paper makes a significant contribution to studies of elections, and electoral violence. Its provision of a new dataset on election results declarations in African countries is also a significant contribution.
    Keywords: Election violence, delayed elections, post-election violence, elections results declarations, announcement of elections results, Africa
    Date: 2023
  6. By: Malte Dold; Tim Krieger
    Abstract: Populist movements increasingly challenge liberal Western market democracies. Populism can be explained only in part by phenomena like globalization and digitization producing winners and losers in economic terms. Growing feelings of alienation from the market-democratic system and the perceived loss of autonomy within the political system contribute to rising populism as well. In this chapter, we ask whether elements of public deliberation may be a means to reasonably responding to the populist challenge by strengthening citizen sovereignty in addition to consumer sovereignty. Ordoliberalism, as a specific form of liberalism that aims at achieving both a ‘functioning and humane order’ within a system of ‘interdependent orders’, is particularly apt to embrace the idea of public deliberation if it is rules-based.
    Keywords: populism, ordoliberalism, democracy, deliberation
    JEL: B29 D63 D72 P16
    Date: 2024
  7. By: Massimo Bordignon (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore); Tommaso Colussi (Università Cattolica del Sacro Cuore; Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore); Francesco Porcelli
    Abstract: This paper empirically investigates the impact of populist governments on public policies and finances. We focus on Italian local governments (i.e. municipalities) over the 2010-2019 period, when a populists, i.e. the Five Stars Movement, became the most voted party in the country. We first document that the re-election probability of incumbent mayors drops by half when they are populist. While populist mayors are not less qualified than mainstream parties, they are significantly younger and less experienced. Estimates from a stacked diff-in-diff design comparing early to not-yet treated municipalities show that the populist government experience significantly worsen municipal finances. Populist mayors also fail to promote social and environmental policies that align with the political demands of their voters, possibly contributing to their difficulties in securing re-election.
    Keywords: Populism, Local Governments, Fiscal Policy, Inequality.
    JEL: H70 H72 P43
    Date: 2024–02
  8. By: Joël Cariolle (FERDI - Fondation pour les Etudes et Recherches sur le Développement International, CERDI - Centre d'Études et de Recherches sur le Développement International - IRD - Institut de Recherche pour le Développement - CNRS - Centre National de la Recherche Scientifique - UCA - Université Clermont Auvergne); Yasmine Elkhateeb (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, Department of Economics, Faculty of Economics and Political Science, Cairo University); Mathilde Maurel (FERDI - Fondation pour les Etudes et Recherches sur le Développement International, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The use of the Internet to access news has an impact on African citizens' perceptions of democracy. Using repeated cross-sectional data from the Afrobarometer survey across 35 African countries over the period 2011-2018, along with an instrumental variable approach, allows addressing potential endogeneity bias between Internet use and citizens' perceptions. The results indicate that using the Internet to obtain information has a significant negative effect on both the preference for and the perception of the extent of democracy. This negative effect is due to several factors. First, Internet use erodes trust in government institutions, mainly in the parliament and the ruling party. It increases the perception that parliament members are involved in corruption. In addition, the erosion of trust is correlated with more political mobilization, in the form of greater participation in demonstrations and voting. These results echo the existing literature and, in particular, hint at the risks of reversal of nascent democratization processes. Finally, the Internet seems to act as a misinformation channel. On the one hand, Internet users' perception of the extent of democracy and perception of the corruption of legislators diverge from experts' assessments. On the other hand, Internet use increases the likelihood of inconsistency in respondents' stances on their preference for democracy. The Internet is not a neutral information channel: it tends to undermine citizens' preference for democracy while also altering perceptions about political institutions.
    Keywords: Internet, Democracy, Misinformation, Africa, Media & democracy
    Date: 2024–01–29
  9. By: Fergusson, Leopoldo (Universidad de los Andes); Robinson, James (University of Chicago); Torres, Santiago (University of Chicago)
    Abstract: We investigate how economic inequality can persist in Latin America in the context of radical falls in political inequality in the last decades. Using data from Colombia, we focus on a critical facet of democratization - the entry of new politicians. We show that initial levels of inequality play a significant role in determining the impact of political entry on local institutions, policy, and development outcomes, which can impact future inequality. A vicious circle emerges whereby policies that reduce inequality are less likely to be adopted and implemented in places with relatively high inequality. We present evidence that this is caused both by the capture of new politicians and barriers to institution and state capacity building, and also by the fact that politicians committed to redistribution are less likely to win in relatively unequal places. Our results, therefore, help to reconcile the persistence of economic inequality with the new political context.
    Keywords: inequality; political entry; public policy; development.
    JEL: D72 D78 H40 H50 P00
    Date: 2024–02–22
  10. By: Mr. Serhan Cevik
    Abstract: Do political regimes determine how geopolitics influence international trade? This paper provides an empirical answer to the question by analyzing the joint impact of democracy and geopolitical distance between countries with an augmented gravity model of bilateral trade flows and an extensive dataset of more than 4 million observations on 59, 049 country-pairs over the period 1948–2018. Implementing the Poisson Pseudo-Maximum Likelihood regression and the two-stage least squares with instrumental variable approach, I find that geopolitical developments are not as important as income and geographical distance in determining bilateral trade flows and that democracy fosters international trade and moderates the potential negative impact of geopolitics. While the impact of democracy and its interaction with geopolitical distance are significant across all countries, the magnitude of these effects is substantially larger in advanced economies than in developing countries, reflecting the greater strength of democratic institutions, on average, in advanced economies.
    Keywords: Geopolitics; democracy; international trade; gravity model
    Date: 2024–02–02
  11. By: Aboushady, Nora; Zaki, Chahir
    Abstract: We use new data on political connections from the World Bank Enterprise Surveys to examine the impact of connections on firms' participation in global value chains (GVCs) for six MENA countries (Morocco, Tunisia, Egypt, the West Bank and Gaza, Jordan, and Lebanon). In addition to political connections, we construct several measures of "political influence" based on available data on lobbying and grand corruption. We also explore whether political connections help firms overcome barriers to trade and investment and increase their participation in GVCs at the extensive and intensive margins. Our findings suggest that political connections do matter for firms' GVC participation. The impact is more pronounced for firms that combine political connections with informal payments to influence policymaking. Our findings on the significance of trade and investment barriers for GVC participation for different categories of firms' political influence are - however - inconclusive.
    Keywords: GVCs, political connections, bribes, MENA region
    JEL: F10 F14 P00
    Date: 2023
  12. By: Costantiello, Alberto; Leogrande, Angelo
    Abstract: In this article, we estimate the role of Political Stability and Absence of Violence and Terrorism-PS in the context of Environmental, Social and Governance-ESG data at world level. We analyse data from 193 countries in the period 2011-2020. We apply Panel Data with Fixed Effects, Panel Data with Random Effects and Pooled Ordinary Least Square-OLS. We found that PS is positively associated, among others, to Population Density and Government Effectiveness, and negatively associated, among others, to Research and Development Expenditure and Maximum 5-day Rainfall. Furthermore, we apply the k-Means algorithm optimized with the application of the Elbow Method and we find the presence of four clusters. Finally, we propose a confrontation among eight different machine-learning algorithms for the prediction of PS and we find that the Polynomial Regression shows the higher performance. The Polynomial Regression predicts an increase in the level of PS of 0.25% on average for the analysed countries.
    Date: 2023–12–18
  13. By: Lisa Bruttel (University of Potsdam, CEPA); Gerald Eisenkopf (University of Vechta); Juri Nithammer (University of Potsdam)
    Abstract: Leadership plays an important role for the efficient and fair solution of social dilemmas but the effectiveness of a leader can vary substantially. Two main factors of leadership impact are the ability to induce high contributions by all group members and the (expected) fair use of power. Participants in our experiment decide about contributions to a public good. After all contributions are made, the leader can choose how much of the joint earnings to assign to herself; the remainder is distributed equally among the followers. Using machine learning techniques, we study whether the content of initial open statements by the group members predicts their behavior as a leader and whether groups are able to identify such clues and endogenously appoint a “good” leader to solve the dilemma. We find that leaders who promise fairness are more likely to behave fairly, and that followers appoint as leaders those who write more explicitly about fairness and efficiency. However, in their contribution decision, followers focus on the leader’s first-move contribution and place less importance on the content of the leader’s statements.
    Keywords: Leadership, Public good, Voting, Promises, Experiment
    JEL: C92 D23 D72 D83
    Date: 2024–02
  14. By: Karmakar, Asim K.; Jana, Sebak Kumar
    Abstract: Mohandas Karamchand Gandhi (1869-1948), known as ‘Mahatma’, meaning ‘great-souled’ as people called him, was born on 2nd October 1869 at Porbandar in India. He was the first to warn the then-Indian leaders, policymakers, and his followers in the late 1940s about the dangers of high inequality in income and wealth distribution prevalent between the rich and the poor in India. This shows his power of visionary gleams and his awareness of the political economy. Gandhi’s vision of non-violence, ahimsa, and right action was based on the idea of the total spiritual interconnectedness and divinity of life as a whole. He was also the first to create three principles of sustainable development: Sarvodaya, Swadeshi, and Satyagraha, aptly relevant to today’s India. His idea of creating of economically self-sufficient local economy is now at the closest proximity to 'Atmanirbhar Bharat' which he tried to launch many years back. It is in this context we try to explore the relevance of Gandhian political economy for today’s India.
    Keywords: Political economy, Platform capitalism, Sarvodaya, Satyagraha, Sustainable development
    JEL: B3
    Date: 2023–12–27

This nep-pol issue is ©2024 by Eugene Beaulieu. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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