|
on Positive Political Economics |
| By: | Bruckner, Dominik; Sahm, Marco |
| Abstract: | Intra-party contests, such as the US primaries, are often used to select a candidate for a subsequent cross-party election. A more accurate selection may improve the quality of the candidate but detract more resources from the subsequent campaign. We model this trade-off as a problem of contest design and show that extreme accuracy levels are optimal: maximum accuracy if the potential candidates are sufficiently heterogeneous, and a highly random selection otherwise. In an extension of our model, the heterogeneity between potential candidates reflects the degree of political polarization within a party. Our results explain varying primary designs within and between countries and shed light upon the paradox of limited competition within democratic parties. |
| Keywords: | Contest Design, Accuracy, Elections, Intra-Party Competition, Political Polarization |
| JEL: | C72 D72 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:bamber:306853 |
| By: | Jaime Bonet-Morón; Jhorland Ayala-García; Jorge Guerra-España |
| Abstract: | This paper investigates the relationship between political continuity and public municipal debt in Colombia, highlighting how political cycles influence fiscal behavior at the subnational level. Unlike national cycles, local political dynamics, marked by consecutive electoral victories of the same party, significantly impact fiscal policy and debt accumulation. Using a Kink Regression Discontinuity design, we explore the effects of these electoral outcomes on public financial debt. Our findings reveal that municipalities governed by the same party or coalition across successive elections exhibit a 0.25% increase in debt levels for every percentage point increase in their election win margin. This trend becomes more pronounced over time, with debt levels peaking in election years. The robustness of our results is confirmed through various bandwidths and placebo tests, which include random shuffling of electoral outcomes and reassignment of electoral results from different years. Our study contributes to the understanding of how political stability or continuity can shape fiscal outcomes at the regional level, a topic that has received limited attention in the political economy literature. **** RESUMEN: Este artículo investiga la relación entre la continuidad política y la deuda pública municipal en Colombia, destacando cómo los ciclos políticos influyen en el comportamiento fiscal subnacional. A diferencia de los ciclos nacionales, la dinámica política local, marcada por victorias electorales consecutivas del mismo partido, impacta significativamente la política fiscal y la acumulación de deuda. Utilizando un diseño de Regresión Discontinua, exploramos los efectos de estos resultados electorales sobre la deuda financiera pública. Nuestros hallazgos revelan que los municipios gobernados por el mismo partido o coalición a lo largo de elecciones sucesivas exhiben un aumento del 0, 25% en los niveles de deuda por cada punto porcentual de aumento en su margen de victoria electoral. Esta tendencia se vuelve más pronunciada con el tiempo, y los niveles de deuda alcanzan su punto máximo en los años electorales. La solidez de nuestros resultados se confirma a través de varios escenarios y pruebas placebo, que incluyen la mezcla aleatoria de resultados electorales y la reasignación de resultados electorales de diferentes años. Nuestro estudio contribuye a la comprensión de cómo la estabilidad política o la continuidad pueden dar forma a los resultados fiscales a nivel regional, un tema que ha recibido poca atención en la literatura de economía política. |
| Keywords: | Public Finances, Local Debt, Political Processes, Elections and Voting Behavior, Finanzas públicas, deuda local, procesos políticos, elecciones y comportamiento electoral |
| JEL: | P25 H63 H72 D72 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:bdr:region:331 |
| By: | Romain Espinosa (CIRED, CNRS, Nogent-sur-Marne, France); Fabien Moizeau (Univ Rennes, CNRS, CREM – UMR6211, F-35000 Rennes, France) |
| Abstract: | We investigate the long-run evolution of Catholics’ view on State secularism in France. We explore the roots of the opposition of Catholics to secularism that can be traced back as far as the 1789 French Revolution. We provide evidence that the divide between Catholics and supporters of secularism persisted throughout the 19th and early 20th Centuries, affecting votes on the major secularization Laws during the Third Republic. We argue that the dual French educational system, partitioned into Catholic and secular schools, may have contributed to this persistence. We then show that Catholics eventually became supporters of secularism in France, closing the political divide on the issue. However, this shift in opinion can be explained by Catholics viewing secularism as a way of limiting the influence of Islam. We argue that views about the involvement of Muslim/Catholic authorities in public debate are significant determinants of political supply in France. Last, we show that Catholics, who now support secularism, continue to exhibit different voting behavior and attitudes than Atheists (regarding women’s rights and same-sex legislation). |
| Keywords: | Secularism, cultural persistence, voting behavior, Catholicism |
| JEL: | Z12 K10 D72 O15 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:tut:cremwp:2024-12 |
| By: | Clara Andresciani; Debora Di Gioacchino; Laura Sabani |
| Abstract: | This paper examines the "decongestion effect" argument, which suggests that the expansion of the private healthcare sector can reduce pressure on the public healthcare system, thereby improving access and quality of care for public sector patients. To this purpose, we develop a probabilistic voting model that endogenizes the public healthcare budget and incorporates a private sector where agents, differentiated by income, can opt out of the public system while still contributing to it fiscally. Our findings indicate that a higher proportion of individuals opting out leads to lower political support for public healthcare and a decline in public healthcare quality, ultimately negating the decongestion effect argument. Using data from 26 European countries, we empirically test our model by examining the relationship between unmet medical needs -used as a proxy for the quality of public healthcare sector- and private health insurance coverage. After controlling for individual and country-level characteristics, our results indicate that as private insurance coverage expands, income disparities in unmet medical needs widen: wealthier individuals benefit more, while poorer individuals face increased unmet needs, providing no evidence supporting the decongestion effect. |
| Keywords: | public/private healthcare mix; voluntary health insurance; unmet medical needs; probabilistic voting; bivariate probit model |
| JEL: | I13 I14 H51 P35 C35 |
| Date: | 2024–10 |
| URL: | https://d.repec.org/n?u=RePEc:sap:wpaper:wp253 |
| By: | Claudio Deiana; Davide Dragone; Ludovica Giua |
| Abstract: | This paper examines the role of domestic elections and political polarisation in shaping international environmental agreements and how electoral dynamics may explain the limited success of current climate cooperation. I focus on two key factors: the impact of domestic electoral pressure on international policy decisions and the mismatch between short election cycles and long-term treaty commitments. Using a 4-stage game modelling a bilateral environmental agreement, I analyse how incumbents strategically balance policy preferences with reelection prospects. Results show that while a green incumbent is often forced to temper their ambitions, a brown incumbent faces fewer electoral constraints, explaining why stringent policies are harder to achieve. Nonetheless, electoral pressure can moderate policies, producing outcomes more aligned with the preferences of the median voter. Finally, I discuss how political polarisation, particularly in two party systems, adds complexity to international cooperation on global public goods. |
| JEL: | I18 L43 L83 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:bol:bodewp:wp1197 |
| By: | Daniel R. Carroll; Andre Luduvice; Eric Young |
| Abstract: | The policy predictions of standard heterogeneous agent macroeconomic models are often at odds with observed policies. We use the 2021 General Social Survey to investigate the drivers of individuals' preferences over taxes and redistribution. We find that these preferences are more strongly associated with political identity than with economic status. We discuss the implications for quantitative macroeconomic models with endogenous policy determination. |
| Keywords: | political economy; redistribution; heterogeneous agents; voting |
| JEL: | E62 D72 H20 |
| Date: | 2024–11–25 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedcwq:99166 |
| By: | Hart, Oliver D.; Landemore, Hélène; Zingales, Luigi |
| Abstract: | We propose a novel way to give mutual funds' investors a voice, an alternative to the pass-through voting large mutual funds companies are starting to implement. Based on the experience of citizen assemblies in the political sphere, we propose allocating the power to decide how to cast mutual funds' votes in corporate ballots on environmental, social, and political issues to a randomly drawn assembly of its investors. We analyze the advantages and limitations of such a model and discuss various implementation issues. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:cbscwp:307593 |
| By: | Romain Espinosa (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École nationale des ponts et chaussées - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique); Fabien Moizeau (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR - Université de Rennes - CNRS - Centre National de la Recherche Scientifique, TEPP - Travail, Emploi et Politiques Publiques - UPEM - Université Paris-Est Marne-la-Vallée - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We investigate the long-run evolution of Catholics' view on State secularism in France. We explore the roots of the opposition of Catholics to secularism that can be traced back as far as the 1789 French Revolution. We provide evidence that the divide between Catholics and supporters of secularism persisted throughout the 19 th and early 20 th Centuries, affecting votes on the major secularization Laws during the Third Republic. We argue that the dual French educational system, partitioned into Catholic and secular schools, may have contributed to this persistence. We then show that Catholics eventually became supporters of secularism in France, closing the political divide on the issue. However, this shift in opinion can be explained by Catholics viewing secularism as a way of limiting the influence of Islam. We argue that views about the involvement of Muslim/Catholic authorities in public debate are significant determinants of political supply in France. Last, we show that Catholics, who now support secularism, continue to exhibit different voting behavior and attitudes than Atheists (regarding women's rights and same-sex legislation). |
| Keywords: | Secularism, cultural persistence, voting behavior, Catholicism |
| Date: | 2024–11–27 |
| URL: | https://d.repec.org/n?u=RePEc:hal:ciredw:halshs-04806416 |
| By: | Hana Jomni; Nikita Zakharov (Department of International Economic Policy, University of Freiburg) |
| Abstract: | We study the effect of terrorist attacks on the migration discourse in the European Parliament (EP). First, using an LLM model, we develop an original dataset on sentiments of all parliamentary speeches concerning migration for 2009-2019, building on a novel dataset by Sylvester et al. (2023). Second, following Brodeur (2018), we employ a causal identification strategy based on quasi-natural randomization in the success or failure of terrorist attacks. We find that while a successful terrorist attack does not change the overall migration sentiment, it has heterogeneous effects conditional on the political position of the speaker: left-wing and, to a lesser extent, centrist politicians become more favorable toward migration after successful attacks, while the right-wing politicians become more negative. Politicians of different ideologies adjusting migration-related sentiment in a direction aligned with their pre-existing partisan positions indicate an increasing polarization among policymakers as a direct consequence of terrorism. |
| Keywords: | Terrorist attacks, migration politics, sentiment analysis, European Parliament, polarization. |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:fre:wpaper:50 |
| By: | Mariana Prats; Sina Smid; Monica Ferrin |
| Abstract: | Global trends such as decreasing public trust, political polarisation and increasing mis- and disinformation have sparked interest in understanding the impact of a lack of trust on democracies. This paper provides an analysis on the socioeconomic characteristics, perceptions of political voice and forms of political engagement of individuals who express a lack of trust in public institutions, with the objective of understanding the impacts of lack of trust on democratic governance and identifying governments’ actions to engage citizens in policymaking. The paper draws on data from the OECD Survey on Drivers of Trust in Public Institutions (OECD Trust Survey), first carried out between November 2021 and March 2022 across 22 OECD countries and can serve as basis for further analysis of data collected through new rounds of the OECD Trust Survey. |
| Keywords: | OECD Trust Survey, Political attitudes, Political engagement, Trust in public institutions |
| Date: | 2024–11–26 |
| URL: | https://d.repec.org/n?u=RePEc:oec:govaaa:75-en |
| By: | C. Caporali; F. Crudu; C. Detotto |
| Abstract: | This study investigates the causal relationship between terrorist violence during the Years of Lead and the decline in voter turnout in Italian political elections. The analysis, which covers electoral participation at the NUTS-3 level from 1972 to 1992, relies on data from the Global Terrorism Dataset for information regarding domestic terrorist attacks. Using causal mediation analysis (CMA) and the front-door criterion (FDC), we identify how the magnitude of attacks – measured by casualties, injuries, and material damages – affects electoral participation. Our findings reveal a nuanced impact of terrorism. Specifically, the results are mainly driven by material damage and to a lesser extent by the number of casualties. |
| Keywords: | causal mediation analysis;front-door criterion;terrorism;turnout |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:cns:cnscwp:202426 |
| By: | Brice Fabre (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, IPP - Institut des politiques publiques); Marc Sangnier (UNamur - Université de Namur [Namur], AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | This paper uses French data to simultaneously estimate the impact of two types of connections on government subsidies allocated to municipalities. Investigating different types of connection in a same setting helps to distinguish between the different motivations that could drive pork-barreling. We differentiate between municipalities where ministers held office before their appointment to the government and those where they lived as children. Exploiting ministers' entries into and exits from the government, we show that municipalities where a minister was mayor receive 30% more investment subsidies when the politician they are linked to joins the government, and a similar size decrease when the minister departs. In contrast, we do not observe these outcomes for municipalities where ministers lived as children. These findings indicate that altruism towards childhood friends and family does not fuel pork-barreling, and suggest that altruism toward adulthood social relations or career concerns matter. We also present complementary evidence suggesting that observed pork-barreling is the result of soft influence of ministers, rather than of their formal control over the administration they lead. |
| Keywords: | Local favouritism, distributive politics, political connections, personal connections |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:hal:ipppap:hal-04816627 |
| By: | Federica Daniele (Bank of Italy); Guido de Blasio (Bank of Italy); Alessandra Pasquini (Bank of Italy) |
| Abstract: | Local opposition to the installation of renewable energy sources is a potential threat to the energy transition. According to widespread belief, mostly based on anecdotal evidence, local communities tend to oppose to the construction of energy plants due to the supposedly negative externalities therein associated (the so-called “not in my backyard†or NIMBY phenomenon). Using administrative data on wind turbine installation and electoral outcomes across municipalities located in the South of Italy during 2005-20, we estimate the impact of wind turbines’ installation on incumbent regional coalitions’ electoral support during the next elections. Our main findings, obtained by instrumenting wind turbine development with wind speed, point in the direction of a mild and not statistically significant electoral backlash for right-wing regional coalitions and of a strong and statistically significant positive reinforcement for left-wing ones. Positive reinforcement appears to be weaker but still statistically significant in areas more exposed to the potentially negative economic effects of wind turbine development, with exposure proxied through higher house prices and tourism intensity. Based on our analysis, the hypothesis of a political cost associated with the development of wind turbines due to a NIMBY type of behavior appears to be rejected by the data. |
| Keywords: | wind turbine installation, electoral outcomes, local opposition |
| JEL: | D72 P18 R12 |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:ahy:wpaper:wp57 |
| By: | Guglielmo Briscese; John List |
| Abstract: | Field experiments provide the clearest window into the true impact of many policies, allowing us to understand what works, what does not, and why. Yet, their widespread use has not been accompanied by a deep understanding of the political economy of their adoption in policy circles. This study begins with a large-scale natural field experiment that demonstrates the ineffectiveness of a widely implemented intervention. We leverage this result to understand how policymakers and a representative sample of the U.S. population update their beliefs of not only the policy itself, but the use of science and the trust they have in government. Policymakers, initially overly optimistic about the program's effectiveness, adjust their views based on evidence but show reduced demand for experimentation, suggesting experiment aversion when results defy expectations. Among the U.S. public, support for policy experiments is high and remains robust despite receiving disappointing results, though trust in the implementing institutions declines, particularly in terms of perceptions of competence and integrity. Providing additional information on the value of learning from unexpected findings partially mitigates this trust loss. These insights, from both the demand and supply side, reveal the complexities of managing policymakers' expectations and underscore the need to educate the public on the value of open-mindedness in policy experimentation. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:feb:natura:00799 |
| By: | Beacham, Austin; Hafner-Burton, Emilie M; Schneider, Christina J |
| Abstract: | The world is experiencing the increasingly destabilizing effects of climate change, but we currently know little about its effects on the quality of democracy. We argue that compounding climate shocks create conditions under which democratic resilience diminishes. The accelerated frequency and severity of climate-induced natural disasters and weather shocks, and their devastating economic and social consequences, have increased the likelihood and frequency of civil and political unrest, especially in contexts where climate-induced disasters compound and the government is unable to address citizen grievances. The necessity to respond to more frequent civil unrest and political instability increases the likelihood that governments rely on repressive measures that reduce democratic resilience. To test this argument, we explore whether compounded experiences with climate shocks increase the likelihood of a country experiencing a decline in democratic resilience. We find that the compounded effects of climate change significantly reduce the quality of democracy within the country, and that this is driven by increased instability and repressive measures in response. These findings have important implications for the future of democratic governance in a world increasingly confronted with the negative effects of climate change. |
| Keywords: | Social and Behavioral Sciences, Climate, democracy, unrest, disasters, backsliding |
| Date: | 2024–12–02 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:globco:qt4wd7x7jv |
| By: | Giovanni Carnazza; Paolo Liberati; Agnese Sacchi |
| Abstract: | In recent times, many countries have continued to deal with political instability due to difficulties in improving democratic practices and limiting episodes of violence and terrorism. Using a sample of 27 European Union (EU) countries observed yearly during the period 1999-2021, we empirically analyze how the domestic political instability of a given country can be affected by the degree of trade diversification adjusted for the political instability of the nonEU countries it trades with. We adopt a network-based approach and build a novel geopolitical dependency index. We find there is a risk of importing political instability along with international trade by increasing trade concentration or the import share from more politically unstable non-EU countries. Given the relevance of the United States and China for European economic activity, we also test our main hypothesis by adjusting the geopolitical dependency index. We see China’s prominent role in trade and political tension in EU countries compared to the US. |
| Keywords: | political instability, trade diversification, network analysis, geopolitical dependency, EU countries |
| JEL: | D74 D85 F10 F50 |
| Date: | 2024–11–01 |
| URL: | https://d.repec.org/n?u=RePEc:pie:dsedps:2024/319 |
| By: | Moshonas, Stylianos; De Herdt, Tom; Titeca, Kristof; Balungwe Shamavu, Paulin |
| Abstract: | This paper examines the fragmented and informalised system of salary supplements in the Congolese civil service, analysing their drivers, their distribution across ministries and their impact on governance. Based on extensive fieldwork, it shows how these supplements shape the political economy of remuneration and the internal dynamics of the public bureaucracy. |
| Keywords: | DR Congo, DRC, civil service, salaries |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:iob:wpaper:2024.09 |