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on Positive Political Economics |
| By: | Shiladitya Kumar |
| Abstract: | How can voters induce politicians to put forth more proximate (in terms of preference) as well as credible platforms (in terms of promise fulfillment) under repeated elections? Building on the work of Aragones et al. (2007), I study how reputation and re-election concerns affect candidate behavior and its resultant effect on voters' beliefs and their consequent electoral decisions. I present a formal model where, instead of assuming voters to be naive, I tackle the question by completely characterizing a set of subgame-perfect equilibria by introducing non-naive (or strategic) voting behavior into the mix. I find that non-naive voting behavior, by using the candidate's reputation as an instrument of policy discipline after the election, aids in successfully inducing candidates to put forth their maximal incentive-compatible promise (among a range of such credible promises) in equilibrium. Through the credible threat of punishment in the form of loss of reputation for all future elections, non-naive voters gain a unanimous increase in expected utility relative to when they behave naively. In fact, comparative statics show that candidates who are more likely to win are more likely to keep their promises. In this framework, voters are not only able to bargain for more credible promises but also end up raising their expected future payoffs in equilibrium. Including such forms of strategic behavior thus reduces cheap talk by creating a credible electoral system where candidates do as they say once elected. Later, I present an analysis that includes limited punishment as a political accountability mechanism. |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2509.08249 |
| By: | Acton, Riley (Miami University); Cook, Emily E. (Texas A&M University); Ugalde Araya, Paola (Louisiana State University) |
| Abstract: | We examine the role of students’ political views in shaping college enrollment decisions in the United States. We hypothesize that students derive utility from attending institutions aligned with their political identities, which could reinforce demographic and regional disparities in educational attainment and reduce ideological diversity on campuses. Using four decades of survey data on college freshmen, we document increasing political polarization in colleges' student bodies, which is not fully explained by sorting along demographic, socioeconomic, or academic lines. To further explore these patterns, we conduct a series of survey-based choice experiments that quantify the value students place on political alignment relative to factors such as cost and proximity. We find that both liberal and conservative students prefer institutions with more like-minded peers and, especially, with fewer students from the opposite side of the political spectrum. The median student is willing to pay up to $2, 617 (12.5%) more to attend a college where the share of students with opposing political views is 10 percentage points lower, suggesting that political identity plays a meaningful role in the college choice process. |
| Keywords: | politics, polarization, college choice, higher education |
| JEL: | I20 I23 J1 |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18099 |
| By: | Calacino, Anthony (University of Oxford); Martinez-Alvarez, Cesar |
| Abstract: | Are policies that contribute to reducing climate vulnerability electorally advantageous? Political science has long studied the politics of carbon dioxide mitigation, but we know less about the political logic of climate impacts. As adaptation lies at the intersection of environmental, social, and disaster policy, its electoral effects are puzzling from a theoretical perspective. We address this gap by studying a program to improve the ability of households to withstand episodes of water scarcity in Mexico City, implemented between presidential cycles. In contrast to conventional forms of social policy, this intervention prioritizes building future resilience instead of immediate material benefits. We take advantage of the means-tested nature of the program to reduce imbalances between treated and control neighbors and estimate a difference-in-differences to evaluate its impact on electoral outcomes. We find that neighborhoods receiving this adaptation policy had, on average, higher levels of support for the party in charge of its implementation at the presidential and gubernatorial levels, compared to similar neighborhoods that did not receive the program. We also posit that reductions in reliance on inadequate water sources are a mechanism that explains this result. Our findings suggest that climate adaptation may be less contentious than mitigation, therefore giving politicians strong incentives to implement them. Moreover, we contribute to the climate politics literature by providing a theoretical framework to understand the political logic of adaptation action, regardless of its specific form or domain. |
| Date: | 2025–08–27 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:24jkx_v1 |
| By: | Arthur Jacobs; Luca Zamparelli (-) |
| Abstract: | This paper analyzes automation as the outcome of political choice. Firms substitute capital for labor through automation, which affects productivity and reduces the labor income share. The automation preferred by a household depends on the composition of its income, specifically its relative dependence on capital versus labor. The median voter theorem aggregates these preferences into a political choice of automation. When wealth is more concentrated than labor, a democratic one-person-one-vote regime implements less automation than the output-maximizing competitive equilibrium, while a plutocratic one-dollar-one-vote regime may induce excessive automation. Increasing wealth concentration intensifies under-automation in democracy and over-automation in plutocracy. We further show that, under plausible conditions, the competitive equilibrium entails excessive automation relative to the social welfare optimum. A calibration to U.S. data demonstrates that alternative political regimes can generate quantitatively large shifts in the labor share. |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:rug:rugwps:25/1120 |
| By: | Chiang, Daniel Minghan (University of Rochester); Fan, Elliott (National Taiwan University); Hsu, Dexter (University of California, Davis) |
| Abstract: | Postwar land reforms in East Asia were implemented as a geopolitical strategy to curb communism expansion. This paper evaluates their long-term political effects in Japan and Taiwan. In Japan, reform increased support for conservative parties and reduced backing for socialist and communist factions, with intergenerational persistence. Taiwan’s reform similarly bolstered electoral support for the Kuomintang. IV analyses support a causal interpretation. Survey evidence suggests that land acquisition fostered a desire for political stability as the mechanism, rather than through reciprocity or pro-market ideology. These findings highlight land reform’s critical role in shaping postwar political alignment and deflecting communist influence. |
| Keywords: | containment, communism, land reform, Japan, Taiwan |
| JEL: | Q15 Q11 N55 P26 |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18095 |
| By: | Perla Carolina Gris Legorreta (Department of Economics, The University of Sheffield - Universidad Iberoamericana); Heidi Jane M. Smith (Department of Economics. Universidad Iberoamericana / Visiting Scholar, George Mason University) |
| Abstract: | Mexico's National Anticorruption System (SNA) was launched with high expectations as a comprehensive framework to curb corruption through institutional coordination and citizen participation. This article analyzes the SNA's design and its implementation to date, highlighting how political dynamics have shaped outcomes. We find that while the SNA's institutional architecture is ambitious – integrating multiple oversight bodies and engaging civil society – its effectiveness has been fundamentally undermined by inconsistent political will and deteriorating democratic governance. Under President Enrique Pena Nieto (2012–2018), the SNA's creation marked a significant reform albeit with uneven commitment. Under President Andres Manuel Lopez Obrador (2018–present), the SNA has been deprioritized amid a shift toward centralized, personalized anti-corruption efforts. We document sluggish implementation, especially in Local Anticorruption Systems, resource shortfalls, and deliberate neglect of autonomous institutions. These challenges are exacerbated by broader democratic backsliding, as executive power concentrates and accountability institutions are weakened. Absent a dramatic change in political support, the SNA is unlikely to fulfill its promise, illustrating the limits of institutional reforms in the face of adverse political conditions. |
| JEL: | D73 H83 K42 |
| Date: | 2025–09–08 |
| URL: | https://d.repec.org/n?u=RePEc:smx:wpaper:2025004 |
| By: | Cha, Jeremiah |
| Abstract: | Metropolitan areas in the United States are undergoing rapid diversification, significantly reshaping the demographics of local leadership. This paper examines how shifts in the racial and ethnic composition of city councils influence land use and housing development, particularly in relation to decision-making diversity. Using data on city council elections and the distribution of new housing permits, I identify the causal effect of electing a minority representative on housing supply. The findings reveal that minority representation increases single-family housing construction at the expense of multi-family housing, challenging conventional expectations about ideology and race. Qualitative interviews with city council members suggest that efforts to address minority underrepresentation drive active support for single-family housing, while distrust of developers—rooted in fears of gentrification—fuels skepticism toward multi-family projects. Overall, the study presents a nuanced view of racial representation: while minorities achieve better representational outcomes, these gains can come with costs. |
| Date: | 2025–08–28 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:a934k_v2 |
| By: | Gavin Wang; Haofei Qin; Xiao Tang; Lynn Wu |
| Abstract: | Misinformation poses a growing global threat to institutional trust, democratic stability, and public decision-making. While prior research has often portrayed social media as a channel for spreading falsehoods, less is known about the conditions under which it may instead constrain misinformation by enhancing transparency and accountability. Here we show this dual potential in the context of local governments' GDP reporting in China, where data falsifications are widespread. Analyzing official reports from 2011 to 2019, we find that local governments have overstated GDP on average. However, after adopting social media for public communications, the extent of misreporting declines significantly but only in regions where the public scrutiny over political matters is high. In such regions, social media increases the cost of misinformation by facilitating greater information disclosure and bottom-up monitoring. In contrast, in regions with low public scrutiny, adopting social media can exacerbate data manipulation. These findings challenge the prevailing view that social media primarily amplifies misinformation and instead highlight the importance of civic engagement as a moderating force. Our findings show a boundary condition for the spread of misinformation and offer insights for platform design and public policy aimed at promoting accuracy and institutional accountability. |
| Date: | 2025–06 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2506.16355 |
| By: | A. Rebechi; M.G. Pittau; P. VanKerm; R. Zelli |
| Abstract: | This paper proposes a full distributional approach to measure the probability of belonging to specific economic classes, which are endogenously determined by the individual s position in the income distribution. Using Australian panel data, we identify pre-determined circumstances associated with class membership. Specifically, we use concomitant variable latent class models to quantify the overlap between distributions and to compare distributional differences and segmentation across social classes and link them to inequality of opportunity. Given the renewed interest in social class dynamics and the growing socioeconomic relevance and political salience of class membership, this study provides important insights into the composition of socioeconomic classes and their evolution over time. |
| Keywords: | inequality of opportunity;mixture models;Class Membership |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:cns:cnscwp:202509 |