Voting on road congestion policy

This paper studies the political economy of urban traffic policy. A city council and a regional government (representing city and suburbs) decide respectively on parking fees and a road toll. Both charges are below the optimum when median voters in city and suburbs prefer cars to public transport sufficiently more than the average. Even if the city government would set an optimal road toll, the regional government blocks it when the median suburban voter prefers cars strongly enough. Letting the city control parking and road pricing may therefore increase chances of adoption of the latter. However, if the city controls parking and the region road pricing, the combined charges are higher than if the city controlled them both. Hence, when voters want all charges below the optimum, the involvement of two governments may be desirable. We also find that earmarking road pricing revenues for public transport is welfare-enhancing, compared to lump-sum redistribution, only if they are topped up by extra funds granted to the city by a higher level of government.     

Mexico under NAFTA: a critical assessment

This paper assesses the evolution and performance of several key economic and social variables in Mexico following the passage of NAFTA. The evidence shows that under NAFTA Mexican trade and foreign direct investment inflows have risen at rapid rates, particularly in the export-oriented assembly-line sector. However, the evidence also suggests that it is hard to disentangle the effects of NAFTA from the other non-NAFTA factors such as demand in the U.S. in explaining the dynamism of the Mexican export sector (and economy). This has been attested by how the Mexican economy has been dragged into a severe recession over the past two years as a result of the relatively mild downturn in the U.S. business cycle.Insofar as employment growth, real wages in manufacturing, and productivity performance is concerned, the evidence presented indicates that the record has been lackluster at best and disastrous at worst. Manufacturing employment fell dramatically after the peso crisis, and remains stagnant. Real wages have plunged since the peso crisis and have yet to recover levels attained in the mid-1980s. In terms of productivity performance, no strong conclusions can be reached given the conflicting estimates in the extant literature. At best, the data show that productivity rose at healthy rates in the tradeable sector, but stagnated in the non-tradeable sector.Finally, the paper presents evidence which shows that both the functional and size distribution of income have become more skewed during the period of trade and investment liberalization (JEL 040,054).     

Voting on Pensions: A Survey

Abstract. The paper presents a nonexhaustive survey of the literature designed to explain emergence, size and political sustainability of pay‐as‐you‐go pension systems. It proposes a simple framework of analysis (a small, open, two overlapping generation economy model), around which some variants are displayed. Dictatorship of the median voter is assumed. The text is organized to answer the following questions: (i) Do political equilibria with PAYG pension schemes exist? (ii) Why do they emerge? (iii) What are the conditions for the participation constraint of the pension game to be verified?, and finally, (iv) What is the size of the pension system chosen by the median voter and how is this size influenced by an exogenous (e.g. demographic) shock?     

Voting with One's Feet

A bstract . Unemployment on Indian reservations averages close to 45 percent, and welfare in its various forms is a more significant source of income for reservation inhabitants than employment. Given these circumstances and given the very low levels of human capital possessed by the American Indian population, there is reason to expect that higher welfare benefit levels would be attractive to Indian migrants. Based on 1990 Census data, this study empirically finds that, over the 1985–1990 period, American Indians, when making migration decisions, exhibited a strong preference for higher welfare areas. This finding lends support to the Tiebout hypothesis of "voting with one's feet" and provides support as well for the establishment of uniform real welfare levels across states.     

Voting on public pensions with hands and feet

Aging changes the political power in a democracy in favor of the older generations. With free labor mobility like that of the EU, the success of the gerontocracy is, nevertheless, limited by migration of the young generations. This connection between political voting and voting with the feet is analyzed in a two-country model with overlapping generations. The interregional competition on public pensions yields premium payments which are larger when the young generations' migration decisions take the impact on future pensions into account (strategic migration) than when these decisions are made myopically. The paper also pays attention to migration (in-)efficiency and to the implications of harmonization principles. Received: November 1999 / Accepted: July 2001 RID="*" ID="*" The paper benefited greatly from discussions at the EEA conference in Santiago de Compostela, the CESifo Workshop on Public Pensions in Munich and seminars in G?ttingen, Mainz, and Tellow. We are grateful to many seminar participants, two anonymous referees of Economics of Governance and, in particular, to Paolo Manasse for their valuable comments and creative hints. The usual disclaimer applies.     

Intertemporal Commitment Problems and Voting on Redistributive Taxation

A rich person who fears a loss of income may later favor redistributive taxation and a mix of taxes and public goods that differs from the one he now favors. If mobility is costly, and if government in each period uses majority voting to determine policy, then this person may prefer to live in a community that is permanently ruled by poor residents. Majority voting is a mechanism that can overcome intertemporal commitment problems of income insurance.     

A further look at linkages between NAFTA equity markets

Recent research finds evidence for convergence among the North American equity markets and argues that this is generated by the North Atlantic Free Trade Accord (NAFTA). In this paper, we re-examine these conclusions and show that the documented cointegration property among the NAFTA equity markets was in fact confined to a sub-period in the late 1990s. We argue that the comovement was caused by the global boom in information technology shares and the resulting change in the sector mix of the value-weighted benchmark indexes used in prior work. We present evidence supporting this alternative hypothesis using an updated data set that includes global industry indexes. Our results have implications for transmission of information across global equity markets and international portfolio diversification.     

Voting for the Open Society

A Labour MP for a mining constituency from 1964 to 1983 writes without inhibition of the backlog of economic reform that cannot be postponed much longer without increasing damage to British society. The June election revealed the strength of feeling among the electorate for an open society that no politician will be able to ignore.     

PUBLIC CHOICE THEORY, PROTECTIONISM AND THE CASE OF NAFTA

Public choice theory suggests that the political process has an in-built tendency to promote protectionist measures favoured by organised interest groups rather than trade liberalisation that would benefit society as a whole. But the example of the North American Free Trade Agreement shows that political campaigns in support of free trade can successfully mobilise public opinion to neutralise the power of special-interest groups. Therefore, it is imperative that politicians and others who believe in free trade remind the public of its benefits.     

Voting power in municipal annexation elections

In many American states, municipal annexation and consolidation require concurrent majority votes of all affected jurisdictions. The effectiveness and fairness of this voting procedure have been criticized on the grounds that a small minority of voters can frustrate the preferences of the overall majority. This paper investigates the extent to which the relative ability of voters in large and small jurisdictions to influence voting outcomes in procedures requiring concurrent majorities is influenced by jurisdictional size. The Banzhaf index, which counts the number of case4s in which a given voter could reverse the overall group decision by changing positions on an issue, is applied to this problem of concurrent voting majorities. Mathematical analysis indicates that the ratio of power between voters in small and large jurisdictions approximately equals the inverse of the square root of the ratio of their population size.     

Corporate Strategy and NAFTA When Environmental Regulations Are Barriers to Trade

SUMMARY

Under the North American Free Trade Agreement (NAFTA), domestic environmental regulations can have the ultimate impact of erecting entry barriers against foreign companies. These actions by domestic firms are part of a corporate “shelter”-seeking strategy. Five recent cases are analyzed out of twenty-four environmental disputes relevant to NAFTA.     

NAFTA and North American stock market linkages: an empirical note

This paper provides tests of the co-movement of the North American stock markets. We find over the post-US stock market crash period, 1987:11 through 1997:03, there is no cointegration present in these markets even when the passage of NAFTA is taken into account. The absence of cointegration allows us to draw several conclusions. First, the stock markets of North America are segmented. Second, the passage of NAFTA has not resulted in a greater integration of these stock markets. Finally, the data do not support the notion of a contagion effect from the 1987 U.S. stock market crash. In conclusion, the potential for long-run international diversification across the markets of North America still exists.     

基于TD-SCDMA/CMMB的电子投票系统的设计

电子政务的发展须适应三网合一发展的需要,逐渐向移动化趋势转变。CMMB与TD-SCDMA是我国在移动通讯领域拥用自主知识产权的两项技术,在当今两项技术融合的基础的条件下,提出了基于CMMB和TD-SCDMA的电子投票系统。并根据面向对象开发技术对系统的需求分析,结合RSA公钥密码体系中的盲签名协议,完成了电子投票系统的设计。     

Rescaling and reforming the state under NAFTA: implications for subnational authority

The new free trade agreements are rescaling governance in ways that have critical implications for subnational governments. The nation state is not simply being hollowed out; rather, a new governance nexus is forming — of nation states, multinational corporations and international agreements — which explicitly excludes subnational and local government voice. This article describes the new governance features of the North American Free Trade Agreement (NAFTA) and illustrates how they work out at the national, subnational and local scales using cases from the United States and Mexico. NAFTA provides the template for other free trade agreements including the Free Trade Area of the Americas (FTAA) and a growing number of bilateral agreements. We show how NAFTA's governance structure is undermining subnational and local government authority in legislative and judicial arenas. Designed to advance privatization of public services, these agreements undermine the very ability of local governments to use markets for public goods by defining traditional state and local governance mechanisms as ‘non‐tariff barriers to trade’. Contradictions between private profit and public interest appear at the subnational level but their resolution is engaged at the global level between private investors and the nation state. Recognition of this rescaling requires attention to the reforming state and its implications for subnational authority and democratic representation and voice. Les nouveaux accords de libre‐échange ré‐échelonne la gouvernance selon des modalités aux implications critiques pour les gouvernements infra‐nationaux. L'État‐nation n'est pas seulement en train d'êvidé de son contenu, mais une nouvelle sphère de gouvernance se forme —à partir d'États‐nations, de groupes multinationaux et d'ententes internationales —, excluant explicitement toute voix de gouvernements locaux ou infra‐nationaux. Cet article décrit les nouvelles caractéristiques de la gouvernance selon l'Accord de Libre‐Échange Nord‐Américain (ALENA) et illustre, avec les cas des Etats‐Unis et du Mexique, comment elles opèrent aux échelons national, infra‐national et local. L'ALENA fournit un modèle pour d'autres accords de libre‐échange, comme la Zone de Libre‐Échange des Amériques (ZLEA) et un nombre croissant de conventions bilatérales. L'article montre comment la structure de gouvernance de l'ALENA mine l'autorité des gouvernements locaux et infra‐nationaux dans les domaines législatif et judiciaire. Destinés à favoriser la privatisation des services publics, ces accords sapent l'aptitude même des gouvernements locaux à recourir aux marchés pour les marchandises publiques, puisqu'ils définissent les mécanismes de gouvernance locale et étatique traditionnels comme des ‘barrières commerciales non‐douanières’. Les contradictions entre profit privé et intérêt public apparaissent au niveau infra‐national, mais leur résolution est entreprise au niveau mondial entre investisseurs privés et État‐nation. La reconnaissance de ce décalage d'échelon appelle à s'intéresser à l'État réformateur et aux implications pour toute autorité infra‐nationale et représentation ou voix démocratique.     

Voting on devolution in a federal country with a bicameral national system

We analyse voting on the devolution of the responsibilities for the provision of public goods to local governments in a federal country, with a bicameral national legislature. In our set-up, devolution means a constitutional fiscal reform which reduces federal public expenditure on a local public good, and simultaneously increases the transfers received by regions, via a tax-sharing mechanism. This allows the regions to provide a greater amount of a local public good which can compensate for the reduction of that provided upon a federal basis. We show under which conditions such a devolution reform is adopted or rejected.     

Voting in the U.S. House on Abortion Funding Issues

A bstract . The Supreme Court's ruling in Webster v. Reproductive Health Services increased the political saliency of the abortion issue. Since pro-choice and pro-life groups within the constituencies of U.S. legislators paid closer attention to abortion-related roll call votes after Webster, the legislators' voting behavior on such issues might have changed as a result of the decision. Accordingly, voting model estimates for abortion funding issues before and after Webster are used to examine changes in the role of legislators' personal policy preferences and the role of policy preferences among their constituency on voting on this issue. The results show that legislators, to some extent, vote according to their personal preferences on abortion funding issues. Moreover, the influence of personal preferences on voting behavior did not change substantially after Webster, despite the change in the outcome of the vote.     

Voting, bargaining, and factor income distribution

The effect of possible price control on factor income distribution under a democratic system is examined in the context of a collective bargaining model. A solution concept of the cooperative game theory called the Harsanyi-Shapley value is chosen to predict a likely outcome. The explicit solution for a non-atomic production economy, with two production factors and a fixed coefficient technology, is obtained. We find that this solution can be realized through prices. It is observed that in this solution, factor income shares respond to the ratio of the total endowments of two factors.     

Geographical Proximity and Mutual Funds' Proxy Voting Behavior

This paper examines the influence of geographical proximity on mutual fund proxy voting decisions. Using mutual fund proxy voting data for the sample period July 1, 2003 to June 30, 2004, we find that fund managers vote more in favor of management of locally headquartered firms. The results are strong for proposals related to executive compensation, anti‐takeover provisions, social and political issues. We provide evidence to show that bias in proxy voting is not being driven by informational advantage; voting bias is prevalent in small as well as large size companies. Additionally, the voting pattern suggests that geographical proximity does not facilitate in better corporate monitoring as revealed in their voting decisions. We find that local fund managers vote more favorably in those proposals which do not increase shareholders' wealth and rights. Our results suggest that familiarity and social interaction between fund managers and firm executives located in the same geographic area might explain the local bias in mutual fund proxy voting behavior. Copyright © 2011 John Wiley & Sons, Ltd.