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on Positive Political Economics |
| By: | Jesús Fernández-Villaverde; Tomohide Mineyama; Dongho Song |
| Abstract: | We study how uneven gains from globalization can endogenously generate protectionism as a political equilibrium. Using U.S. data, we document that regions more exposed to import competition display stronger opposition to globalization, especially among households with little financial wealth, and that firms in trade-exposed sectors sharply increase lobbying expenditures. To interpret these patterns, we develop and quantify a general equilibrium Ricardian model with heterogeneous households, input-output linkages, and endogenous trade policy shaped by voting and lobbying. Distributional shocks reallocate political support among voters, while lobbying propagates through production networks, generating strategic complementarities that sustain protectionism. Calibrated to U.S.-China sectoral data from 1991--2019, the model accounts for rising inequality, declining support for globalization, and key aggregate trends in consumption and trade. |
| JEL: | D57 D58 D63 D72 F1 F2 F4 F6 |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:34672 |
| By: | Romain Biard (Université Marie et Louis Pasteur, LmB, UMR6623, F-25000 Besançon, France); Mostapha Diss (Université Marie et Louis Pasteur, CRESE UR3190, F-25000 Besançon, France); Salma Larabi (Université Marie et Louis Pasteur, CRESE UR3190, F-25000 Besançon, France) |
| Abstract: | We propose a weighted minority voting mechanism within a two-round sequential voting process, in which all individuals retain their voting rights in the second round but with different weights depending on the first-round outcome. In a utilitarian framework where individuals have a given utility function that depends on the outcomes of each round, first-round winners are identified and vote with reduced weight in the second round, while losers retain full weight. By giving greater weight to first-round losers, this design ensures that first-round winners continue to contribute to the final decision without dominating it, thereby mitigating repeated disadvantages for losers. We then compare the expected aggregate utility of society across different levels of second-round weight assigned to first-round losers, including both the simple majority rule – where all voters carry equal weight in both rounds – and the limiting case of minority voting where first-round losers receive no weight in the second round. To do so, we analyze two models: one in which individual utility derives solely from material payoffs, and another in which a form of harmony is considered, whereby individuals incur a utility loss if others repeatedly belong to the losing minority. This analysis allows us to assess how strategic behavior affects the effectiveness of the proposed mechanism. |
| Keywords: | Voting, Minority Voting, Simple Majority, Utilitarianism, Harmony. |
| JEL: | C72 D70 D71 D72 |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:crb:wpaper:2026-01 |
| By: | Eggers, Andrew C. (University of Chicago); Li, Zikai (University of Chicago); Rubenson, Daniel |
| Abstract: | Survey research yields the surprising conclusion that voters strategically abandon small parties to a similar degree in first-past-the-post (FPTP) and proportional representation (PR) systems. If true, this challenges Duverger's classic theory that strategic voting helps explain why PR systems have more parties. We argue instead that observational analyses of FPTP and PR elections produce similar patterns of apparently strategic voter behavior because they suffer from the same methodological flaw. After reproducing previous findings in a more comprehensive dataset, we show via placebo tests that the same research design would erroneously imply strategic behavior in non-strategic outcomes like party identification. We also show that a more rigorous design reduces but does not eliminate the problem. Our findings suggest that isolating the effect of party popularity on vote choice using observational data may be fundamentally more difficult than the literature has recognized, and that alternative approaches are needed. |
| Date: | 2026–01–08 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:vtbw7_v1 |
| By: | Julia Cagé (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, CEPR - Center for Economic Policy Research); Edgard Dewitte (Nuffield - Nuffield - University of Oxford) |
| Abstract: | We study electoral campaigns over the long run, through the lens of their spending. We build a novel, exhaustive dataset on U.K. general elections from 1857 to 2017. We provide quantitative insights on the history of campaigns, including the shift away from paid staff toward advertising. We then show that the correlation between candidate spending and votes has strongly increased since the 1880s, peaking in the last quarter of the twentieth century. We link this pattern to the introduction of new information technologies—in particular, local radio and the Internet—and to the transformations of campaign strategies. |
| Date: | 2025–10–08 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05446470 |
| By: | Erickson, Jacob (Vassar College) |
| Abstract: | As conversational AI systems become increasingly integrated into everyday life, they raise pressing concerns about user autonomy, trust, and the commercial interests that influence their behavior. To address these concerns, this paper develops the Fake Friend Dilemma (FFD), a sociotechnical condition in which users place trust in AI agents that appear supportive while pursuing goals that are misaligned with the user’s own. The FFD provides a critical framework for examining how anthropomorphic AI systems facilitate subtle forms of manipulation and exploitation. Drawing on literature in trust, AI alignment, and surveillance capitalism, we construct a typology of harms, including covert advertising, political propaganda, behavioral nudging, and surveillance. We then assess possible mitigation strategies, including both structural and technical interventions. By focusing on trust as a vector of asymmetrical power, the FFD offers a lens for understanding how AI systems may undermine user autonomy while maintaining the appearance of helpfulness. |
| Date: | 2026–01–08 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:4ahj9_v1 |
| By: | Zafer Kanik; Zaruhi Hakobyan |
| Abstract: | Social media platforms systematically reward popularity but not authenticity, incentivizing users to strategically tailor their expression for attention. We develop a utilitarian framework addressing strategic expression in social media. Agents hold fixed heterogeneous authentic opinions and derive (i) utility gains from the popularity of their own posts--measured by likes received--, and (ii) utility gains (losses) from exposure to content that aligns with (diverges from) their authentic opinion. Social media interaction acts as a state-dependent welfare amplifier: light topics generate Pareto improvements, whereas intense topics make everyone worse off in a polarized society (e.g., political debates during elections). Moreover, strategic expression amplifies social media polarization during polarized events while dampening it during unified events (e.g., national celebrations). Consequently, strategic distortions magnify welfare outcomes, expanding aggregate gains in light topics while exacerbating losses in intense, polarized ones. Counterintuitively, strategic agents often face a popularity trap: posting a more popular opinion is individually optimal, yet collective action by similar agents eliminates their authentic opinion from the platform, leaving them worse off than under the authentic-expression benchmark. Preference-based algorithms--widely used by platforms--or homophilic exposures discipline popularity-driven behavior, narrowing the popularity trap region and limiting its welfare effects. Our framework fills a critical gap in the social media literature by providing a microfoundation for user welfare that maps to observable metrics, while also introducing popularity incentives as an unexplored channel in social networks distinct from the canonical mechanisms of conformity, learning, persuasion, and (mis)information transmission. |
| Date: | 2026–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2601.01370 |
| By: | Navin Kartik; Elliot Lipnowski; Harry Pei |
| Abstract: | Does electoral replacement ensure that officeholders eventually act in voters' interests? We study a reputational model of accountability. Voters observe incumbents' performance and decide whether to replace them. Politicians may be "good" types who always exert effort or opportunists who may shirk. We find that good long-run outcomes are always attainable, though the mechanism and its robustness depend on economic conditions. In environments conducive to incentive provision, some equilibria feature sustained effort, yet others exhibit some long-run shirking. In the complementary case, opportunists are never fully disciplined, but selection dominates: every equilibrium eventually settles on a good politician, yielding permanent effort. |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2512.13351 |
| By: | Edward, Caesar |
| Abstract: | This paper, "The Geometry of Power, " presents a path-integral framework for analyzing the dynamics of political regimes under uncertainty. Whereas the earlier work, The Calculus of Power, focused on optimal paths, the present approach replaces single optimal paths with ensembles of permissible political histories, each weighted by an action functional. In this paper, we also introduce the concepts of path entropy, state entropy, and free action to describe the structures of political accessibility and strength. We then used Monte Carlo simulations, calibrated with political, economic, and conflict indicators, to test the validity of the framework on six East African countries: Ethiopia, Kenya, Rwanda, South Sudan, Tanzania, and Uganda. The aim of the analysis is to evaluate the relative accessibility of democratic, authoritarian, military, and collapsed regime endpoints. The results show that the stability of regimes and shifts is governed not only by minimizing costs but also by the “entropy of the geometry” that shapes rational political behavior under uncertainty. Authoritarian regimes are found to be structurally strong under prevailing regional constraints. However, democratic transitions are restricted to narrow and fragile pathways. |
| Date: | 2026–01–06 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:t9pur_v1 |
| By: | Ignacy Nieweglowski; Aviv Yaish; Fahad Saleh; Fan Zhang |
| Abstract: | Cryptoassets launched by political figures, e.g., political finance (PoliFi) tokens, have recently attracted attention. Chief among them are the eponymous tokens backed by the 47th president and first lady of the United States, TRUMPandMELANIA. We empirically analyze both, and study their impact on the broad decentralized finance (DeFi) ecosystem. Via a comparative longitudinal study, we uncover a "Trump Effect": the behavior of these tokens correlates positively with presidential approval ratings, whereas the same tight coupling does not extend to other cryptoassets and administrations. We additionally quantify the ecosystemic impact, finding that the fervor surrounding the two assets was accompanied by capital flows towards associated platforms like the Solana blockchain, which also enjoyed record volumes and fee expenditure. |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2512.06036 |
| By: | Grimm, Sonja; Weiffen, Brigitte; Mross, Karina |
| Abstract: | Autocratisation has become a defining global trend, replacing decades of democratisation and forcing democracy promoters to rethink their approaches. Democracy promoters must adapt to several challenges, including autocratisation in target countries, the rise of powerful autocratic competitors in the global arena, and challenges to democracy in some of the very countries promoting it. Moreover, the crisis in development aid fuelled by the withdrawal of funding by the United States (US) and other countries, and their prioritisation of security, pose further structural challenges. This Policy Brief examines the effects of the global trend of autocratisation on international democracy promotion, summarising findings from a collaborative research project (Grimm et al., 2025). The findings show that democracy promoters respond to these shifts in four ways: 1) choosing to "carry on and observe" by continuing existing programmes and maintaining cooperation rather than risking confrontation; 2) reinforcing rhetorical and diplomatic efforts for democracy, to signal continued commitment; 3) selectively adapting policies and strategies, with renewed focus on civil society, education and targeted funding, yet rarely making substantive policy changes; 4) disengaging by shifting cooperation toward less politicised fields or withdrawing entirely. So far, however, we lack evidence on the effectiveness of these responses to counter autocratisation. Given the new challenges to democracy promotion arising from the changed international context, democracy promoters should consider taking the following actions: Ramping up efforts to counter the rise of autocratic powers: Democracy promoters should proactively deepen their pro-democracy cooperation, reaffirm democratic alliances and maintain a clear normative profile. They should invest in long-term partnerships with governments and civil societies committed to democratic reform. Revitalising the norm of democracy: Democracy promoters must make a case for why democracy matters, highlighting that it delivers rights and freedoms, as well as stability, prosperity, and peace - at least as effectively as autocratic regimes. Emphasising its tangible benefits can help restore faith in its long-term value, and counter the appeal of autocratic alternatives. Coordinating strategies and combining strengths: Joint frameworks for action among democracy promoters are needed that allow for the simultaneous use of different instruments, e.g. political dialogue, development cooperation, human rights advocacy and economic incentives. Combining direct and indirect democracy promotion increases adaptability. Adapting democracy promotion to the context: In contexts where democracy is being eroded, prioritise the defence of current democratic institutions, actors and practices rather than pushing for rapid reforms. Strengthen local actors who uphold democratic values, protect them against repression and maintain spaces for civic participation. Restoring credibility: Democracy-promoting states and organisations should openly discuss challenges to democracy at home in order to rebuild trust, strengthen legitimacy and facilitate collaboration in defence of democracy. Reinforcing own democratic institutions and upholding the rule of law contributes to restoring the credibility of democracy promoters. |
| Keywords: | democracy, autocracy |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:idospb:334562 |
| By: | Dilger, Alexander |
| Abstract: | Eine politische Brandmauer bezeichnet die systematische Ausgrenzung von einer oder mehreren Parteien dahinter durch die übrigen (relevanten) Parteien. Sie kann aus einem Koalitionsverbot bestehen. Aktuell verbieten sich die anderen Parteien eine zustimmende Mehrheit, die nur mit Stimmen der ausgegrenzten AfD zustande kommt. Konsequenter wäre das symmetrische Verbot auch einer ablehnenden Mehrheit nur mit Stimmen einer ausgegrenzten Partei, wodurch eine relative Mehrheit diesseits der Brandmauer ausreichen würde statt einer (über)großen Koalition. Eine Brandmauer soll die ausgegrenzte Partei von der Macht und vor allem Regierung fernhalten, kann ihr jedoch Wähler zuführen, bis sie allein regieren kann. Wenn sie verfassungswidrig ist, ist das besonders gefährlich und wäre ein Parteiverbot besser. Wenn sie nicht verfassungswidrig ist, scheitert ein Verbotsverfahren, ist die Brandmauer aber auch nicht wirklich gerechtfertigt. Besser als die Ausgrenzung von ganzen Parteien ist deshalb die Ausgrenzung von verfassungsfeindlichen Personen in allen Parteien. |
| Abstract: | A political firewall refers to the systematic exclusion of one or more parties behind it by the other (relevant) parties. It can consist of a ban on coalitions. Currently, the other parties prohibit themselves from forming an approval majority that would only be possible with votes from the excluded AfD. A more consistent approach would be a symmetrical ban on a rejection majority also only with votes from an excluded party, whereby a relative majority on this side of the firewall would suffice instead of a (super)grand coalition. A firewall is intended to keep the excluded party out of power and, above all, out of government, but it can also steer voters towards this party until it can govern alone. If it is unconstitutional, this is particularly dangerous, and a party ban would be preferable. If it is not unconstitutional, a ban will fail, but the firewall is also not truly justified. Therefore, excluding individuals hostile to the constitution from all parties is preferable to excluding entire parties. |
| Keywords: | Ausgrenzung, Brandmauer, Demokratie, Mehrheit, Parteiverbot |
| JEL: | D72 D74 K19 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:umiodp:335024 |