nep-pol New Economics Papers
on Positive Political Economics
Issue of 2024‒04‒15
nine papers chosen by
Eugene Beaulieu, University of Calgary

  1. Income shocks, political support and voting behaviour By Richard Upward; Peter Wright
  2. Politicians' Neighborhoods: Where Do They Live and Does It Matter? By Folke, Olle; Martén, Linna; Rickne, Johanna; Dahlberg, Matz
  3. The Populist Dynamic: Experimental Evidence on the Effects of Countering Populism By Vincenzo Galasso; Massimo Morelli; Tommaso Nannicini; Piero Stanig
  4. Individualism and Political Stability By Jeong, Minhyeon; Kim, Wongi
  5. The Political Economy of Redistribution and (in)Efficiency in Latin America and the Caribbean By Guizzo Altube, Matías; Scartascini, Carlos; Tommasi, Mariano
  6. Are Municipal Politicians Ideological Moderates? By Lucas, Jack
  7. Are all Polls Equal? Analyzing the Polls of the US2020 election, a new Perspective By Durand, Claire
  8. Is There Really a Dictator's Dilemma? Information and Repression in Autocracy By Gehlbach, Scott; Luo, Zhaotian; Shirikov, Anton; Vorobyev, Dmitriy
  9. What Mattered Most in the Brexit Vote? Evidence from Detailed Regression and Decomposition Analysis By Drinkwater, Stephen; Blackaby, David H.; Robinson, Catherine

  1. By: Richard Upward; Peter Wright
    Abstract: We provide new evidence on the effects of economic shocks on political support, voting behaviour and political opinions over the last 25 years. We exploit a sudden, large and long-lasting shock in the form of job loss and trace out its impact on individual political outcomes for up to 10 years after the event. The availability of detailed information on households before and after the job loss event allows us to reweight a comparison group to closely mimic the job losers in terms of their observable characteristics, pre-existing political support and voting behaviour. We find consistent, long-lasting but quantitatively small effects on support and votes for the incumbent party, and short-lived effects on political engagement. We find limited impact on the support for fringe or populist parties. In the context of Brexit, opposition to the EU was much higher amongst those who lost their jobs, but this was largely due to pre-existing differences which were not exacerbated by the job loss event itself.
    Keywords: job loss; voting; political support
    Date: 2023
  2. By: Folke, Olle (Department of Political Science, Uppsala University); Martén, Linna (Swedish Institute for Social Research, Stockholm University); Rickne, Johanna (Swedish Institute for Social Research, Stockholm University); Dahlberg, Matz (Institute for Housing and Urban Research, Uppsala University)
    Abstract: This paper studies the political economy of local politicians’ residential neighborhoods. We use Swedish data on the location of all politicians’ and citizens’ homes, and their socioeconomic traits. A descriptive analysis shows that politicians live in neighborhoods with more socioeconomically advantaged residents and more of their own party’s voters. Next, we analyze whether having politicians in a neighborhood reduces the likelihood that new buildings are placed there, since these projects often generate local opposition. This analysis compares the neighborhoods of politicians with different degrees of political power and is restricted to close elections. We find that the presence of more politicians with governing power reduces the neighborhood’s proportion of new approved building permits for multifamily homes, but not for single-family homes. The result is most likely explained by undue favoritism. We conclude that spatial political representation matters, and that unequal spatial representation can increase geographic economic inequality.
    Keywords: political geography; geographic inequality; proportional representation; local politics; descriptive representation
    JEL: R23
    Date: 2024–11–14
  3. By: Vincenzo Galasso; Massimo Morelli; Tommaso Nannicini; Piero Stanig
    Abstract: We evaluate how traditional parties may respond to populist parties on issues aligning with populist messages. During the 2020 Italian referendum on the reduction of members of Parliament, we conducted a large-scale field experiment, exposing 200 municipalities to nearly a million impressions of programmatic advertisement. Our treatments comprised two video ads against the reform: one debunking populist rhetoric and another attributing blame to populist politicians. This anti-populist campaign proved effective through demobilization, as it reduced both turnout and the votes in favor of the reform. Notably, the effects were more pronounced in municipalities with lower rates of college graduates, higher unemployment, and a history of populist votes. This exogenous influence introduced a unique populist dynamic, observable in the 2022 national election where treated municipalities showed increased support for Brothers of Italy, a rising populist party, and decreased support for both traditional parties and the populists behind the 2020 reform. A follow-up survey further showed increased political interest and diminished trust in political institutions among the residents of municipalities targeted by the campaign.
    Date: 2024
  4. By: Jeong, Minhyeon (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)); Kim, Wongi (Sungshin Women's University)
    Abstract: This study analyzes the relationship between individualism as a cultural trait and political instability as a political characteristic. The intuition of the analysis is that cultural traits can determine political preferences of members of society. The study considers a specific political belief: “How much should the government protect individual property rights?” which extends to broader political beliefs such as profree market vs. pro-redistribution. According to numerous studies, individualistic cultures tend to support stronger protection of property rights than collectivist cultures. If the degree of protection of property rights is determined by the political choices of the members of society, it can be inferred that the political preferences that lead to strong protection of property rights reflect the individualistic cultures inherent in society members. That is, the political preferences of society members regarding the degree of property rights protection―or, in a broader sense, pro-free market versus pro-redistribution―are influenced by their cultural traits of individualism or collectivism. This study presents a politico-economic model that captures this intuition. The theoretical results are as follows. First, in societies where neither individualism nor collectivism dominates, political preferences for free-market or redistribution contrast more sharply than in societies where individualism or collectivism dominates. Second, this contrast in political preferences leads to political instability, such that societies where neither individualism nor collectivism dominates tend to be more politically unstable. This study provides empirical evidence supporting the theoretical results. This study identifies a relationship between cultural traits, political preferences and political instability, shedding light on the impact of culture on economic growth. In a nutshell, societies with highly heterogeneous cultural traits among their members are prone to polarization of political preferences, leading to political instability, which constrains economic growth in the long run.
    Keywords: culture; political instability; institutions; political economy
    JEL: E02 O43
    Date: 2023–12–29
  5. By: Guizzo Altube, Matías; Scartascini, Carlos; Tommasi, Mariano
    Abstract: Predominant views on the political economy of Latin America and the Caribbean tend to emphasize that elite domination helps to understand the high levels of inequality. The contemporary fiscal version of that assertion goes something like “the rich are powerful and they dont like taxes, hence we have little taxation and little redistribution.” That is a good approximation to the reality of some countries, but not of others. There are cases in the region where there are high levels of taxation and non-negligible redistributive efforts. But in some of those cases such redistribution comes hand in hand with macroeconomic imbalances, high inflation, low growth, as well as low-quality public policies. When redistributive efforts are short-sighted and attempted with inefficient public policies, fiscal imbalances lead to inflation and to frequent macroeconomic crises that reduce growth and thwart poverty reduction efforts. The argument of this paper is that there are various possible political configurations (including elite domination and populism among others) that lead to different economic and social outcomes (including the degree of redistribution and others). We postulate that each configuration of social outcomes emerges out of different political economy equilibria. Different countries in the region will be in different political economy equilibria, and hence will have different combinations of political economy syndromes and of socioeconomic outcomes. In this paper, we characterize the countries regarding the size of the public sector, how much fiscal redistribution there is, and how efficient this public action is. We summarize various strands of literature that attempt to explain some elements of that fiscal vector one at a time; and then attempt to provide a simple framework that might explain why different countries present different configurations of size, distributiveness, and efficiency.
    Keywords: Inequality;redistribution;political economy;growth;Poverty
    JEL: H20 H23 E62 P16
    Date: 2023–10
  6. By: Lucas, Jack (University of Calgary)
    Abstract: For more than a century, practitioners and researchers have often argued that municipal politicians are more ideologically moderate than their national counterparts. Testing this claim requires direct comparison of politicians who represent similar constituents but who are elected at different levels of government, but comparative data of this sort are rarely available. Here, I take advantage of new data from surveys of Canadian municipal, provincial, and federal politicians to provide a robust test of the "municipal moderation" thesis. Comparing politicians' symbolic ideological self-understandings (N=3, 000) as well as their latent policy ideologies (N=775), I find strong evidence that municipal politicians think of themselves as more ideologically moderate, but are not more moderate in their actual policy preferences. I further show that these differences disappear when non-partisan local politicians are excluded from the analysis. My results reinforce recent research suggesting that municipal politicians may hold non-ideological cultural norms but are embedded within an ideological electoral and policymaking context. My analysis also illustrates the potential for "vertical" rather than "horizontal" comparative research designs to illuminate important debates in local and urban politics.
    Date: 2024–03–19
  7. By: Durand, Claire (Université de Montréal)
    Abstract: At the dawn of the 2024 American presidential campaign, it is not pointless to reassess what happened during the 2020 campaign. In that election, the polls have been the least accurate since 1996, with a notable disparity in results depending on the poll's mode of administration and sampling frame or source. Based on their methodology, the 222 national-level campaign polls were categorized as mixed-mode (16%), single-mode quasi-random polls (25%), and web opt-in polls (59%). Using local regression and multilevel analysis, the study revealed differences in campaign trends across categories. All the polls using random or quasi-random sampling indicated an initial rise in voting intention for Joe Biden followed by a decline until election day, while web opt-in polls showed his support as stable. Notably, mixed-mode polls provided an almost perfect election forecast. The poll estimates of the last ten days support these findings, showing higher accuracy within the mixed-mode and single-mode quasi-random polls compared to web opt-in polls. The study suggests that different modes and sources capture varying segments of the population, leading to more accurate polling. The results stress the need for academia, media, and pollsters to closely monitor the methodological diversification introduced in the 2020 election.
    Date: 2024–03–07
  8. By: Gehlbach, Scott; Luo, Zhaotian; Shirikov, Anton; Vorobyev, Dmitriy
    Abstract: In his seminal work on the political economy of dictatorship, Ronald Wintrobe (1998) posited the existence of a "dictator's dilemma, " in which repression leaves an autocrat less secure by reducing information about discontent. We explore the nature and resolution of this dilemma with a formalization that builds on recent work in the political economy of nondemocracy. When the regime is sufficiently repressive, and the dictator's popularity correspondingly unclear to opposition as well as autocrat, the ruler faces two unattractive options: he can mobilize the repressive apparatus, even though there may be no threat to his rule, or he can refrain from mobilizing, even though the threat may be real. Semicompetitive elections can ease the dilemma through the controlled revelation of discontent. Depending on the ease of building a repressive apparatus, autocrats who manage information in this way may prefer more or less repression than Wintrobe's dilemma alone implies.
    Date: 2024–03–21
  9. By: Drinkwater, Stephen (University of Roehampton); Blackaby, David H. (Swansea University); Robinson, Catherine (University of Kent)
    Abstract: The UK's decision to leave the EU continues to have major economic, political and social implications. It is therefore unsurprising that the reasons behind Brexit have been widely discussed. However, whilst existing empirical evidence has tended to focus on specific factors, we undertake a comprehensive analysis of the leave vote using a large-scale survey dataset to identify the relative importance of key underlying factors. Specifically, we apply regression- based techniques, including decomposition analysis, to quantify the impact of different influences. Our results indicate that a complex range of factors are able to explain a high proportion of differences in the leave vote across sub-groups of the British electorate. Moreover, Brexit voting was underpinned by cultural factors, especially attitudes towards immigration, with educational differences also playing an important role. We find that other influences such as age and economic factors become less important after other influences have been taken into account. Our findings are discussed within the context of some of the economic and social consequences that have emanated from the decision to leave the EU.
    Keywords: EU referendum, inequality, globalisation, United Kingdom
    JEL: D72 F60 J24
    Date: 2024–03

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