Race,class, and politics in the black community of Boston

Conclusion We found that there are indeed some slight differences in the electoral behavior of black voters when we separate them into high and low socio-economic areal categories based on the level of median income. These slight differences include turnout rates for primary and general elections and voter registration rates. The higher the socioeconomic status of the black electorate in Boston, the higher the turnout and registration rates for that area tended to be; however, this relationship was not found to be consistent among all the areas selected for study. Despite these differences in electoral behavior or “practices,” our areal model does not suggest any significant political schisms based on the sicioeconomic indicators used. Black voters tended to vote the same way on a number of city and state ballot questions, support the same candidates at both the city and state level, and vote the liberal preference on both issues and candidates regardless of socioeconomic background. In addition, there is some evidence that the higher a black voter is on the socioeconomic scale, the greater his or her tendency will be to vote the liberal position on various issues and candidates. Our model also suggests that black voters will tend to support black candidates regardless of some socioeconomic factors. If this model can be used as an indication of class differences in the black community, then our data show that socioeconomic criteria are not as salient as race in determining the political behavior and preferences of black voters.     

Political Party Impacts on Direct Democracy: the 2015 Greek Austerity Referendum

On July 5, 2015, Greek voters were asked whether to approve or reject the terms of an austerity program offered by the European Union (EU) to resolve an ongoing financial crisis. With a turnout rate of 62.5% overall, 61.3% of Greeks voted “no.” While a majority of voters in every district opposed the bailout’s terms, the margin against the proposed austerity measures ranged from 51.2% in Lakonias to 73.8% in Chanion. This paper presents empirical evidence on the determinants of the “no” vote across Greece’s 56 electoral districts. Our analysis is grounded in public choice theories of why large numbers of people turn out to vote in mass elections. In addition to controlling for standard “instrumental” vote motives, we ask whether political party labels, which serve as summary measures of partisan positioning, and party platforms, which express partisan preferences on ballot questions, are salient in determining electoral outcomes. Holding constant the unemployment rate and average voter age (at the regional level) and the fraction of young people casting ballots for the first time on July 5, 2015 (at the district level), we find that the percentage of ‘no’ votes was reduced significantly by voter support for Greece’s leading pro-austerity party (New Democracy) in the previous nationwide election held in January 2015. In contrast, voter support in January for the anti-austerity party (Syriza), led by sitting Prime Minister Alexis Tsipras, had no measurable impact on July’s referendum results. This finding offers support for both instrumental and expressive theories of voting and bolsters the claim that political parties can shape electoral outcomes on questions decided by an institution of direct democracy.     

Does Voter Turnout Influence School Bond Elections?

This article investigates the role of voter turnout in school bond election outcomes. It is widely believed that turnout is negatively related to bond approval rates. Conclusions from previous empirical research, however, may be misleading because many sociodemographic factors and election parameters that influence bond support are also likely to influence voter turnout decisions. To account for the endogeneity of turnout, we employ an instrumental variable approach. We find that the persistent part of voter turnout plays a negligible role in explaining bond approval shares conditioned on election timing, past voting behavior, and district characteristics. Using first‐difference models, change in turnout has a negative and significant influence on change in approval share and probability of bond success. Our results support previous research and suggest that targeted voter mobilization strategies have the potential to influence school bond outcomes.     

A Classroom Exercise: Voting by Ballots and Feet

This classroom experiment illustrates the efficiency-enhancing property of a Tiebout system in which local public goods decisions are determined by a political process. Students are given playing cards that induce diverse preferences for expenditures on alternative public goods and are initially assigned to specific communities. Then those in each community vote on the type and level of public goods provision, which determine the tax cost. After the provision and tax results are announced, students are free to move to a location where the prior results are more consistent with their preferences. This process continues for several rounds, with a new vote taken at each location after moves have been made. The exercise demonstrates that the combination of voting with feet and ballots tends to increase the total net benefit for all communities. The voting on provision levels is structured to facilitate a discussion of the median voter theorem.     

Spoils of War: The Political Legacy of the German hyperinflation

I study the link between monetary policy and electoral outcomes by linking new data on the 1923 German hyperinflation and the vote share of the main parties of Weimar Republic from 1924 to 1933. Exploiting cross-sectional variation in prices in over 280 cities, I find that inflation predicts the vote share of the Volksrechtspartei, an association-turned-party of inflation victims, and positively correlates with the Communists in the 1932 elections. Hyperinflation also leads to a decline in turnout, with a loss of confidence in the German institutions. However, contrary to received wisdom, areas more affected by inflation did not see a higher vote share for the Nazi party. Results are robust to a range of specifications, including models in differences, panel data with fixed effects, Coarsened Exact Matching estimation, Conley standard errors, and an instrumental variable strategy.     

The Electoral College System, Political Party Dominance, and Voter Turnout, With Evidence from the 2004 Presidential Election

Within the context of a broadened version of the “rational voter model,” this study empirically investigates a hypothesis that asserts that within the context of the Electoral College System, the greater the degree to which either the Republican Party or the Democratic Party dominates the other in any given state, the lower the aggregate voter participation rate in that state. Using the 2004 Presidential election as the study period, the analysis includes a number of economic and demographic variables. Using a different methodology than previous studies of voter turnout and the Electoral College System, as well as more current data, this study finds strong empirical evidence for the hypothesis. It also is suggested that, logically, the Electoral College System distorts the pattern of voter turnout across states.      

Protection versus Free Trade: Lobbying Competition between Domestic and Foreign Firms

This article considers how political interaction between policymakers and domestic and foreign firms endogenously determines tariff rates. We show that because of lobbying competition between foreign and domestic firms, even a less competitive foreign firm can successfully elicit a tariff reduction under reasonable conditions. Moreover, lobbying competition may also increase the level of aggregate domestic welfare when the market powers of the competing firms are sufficiently alike.     

On Taxation,Political Accountability and Foreign Aid: Empirics to a Celebrated Literature

The Eubank findings on taxation, political accountability and foreign aid have had an important influence on academic and policymaking debates. Eubank has warned that his findings should not be generalised across Africa until they are backed by robust empirical evidence. This paper puts some empirical structure to the celebrated literature. The empirical evidence which is based on data from 53 African countries for the period 1996‐2010 broadly confirms the Somaliland‐based Eubank hypothesis that in the absence of foreign aid, the dependence of government on local tax revenues provides the leverage for better political governance.     

Contests and the Private Production of Public Goods

The private provision of public goods generally suffers from two types of efficiency failures: sorting problems (the wrong individuals contribute) and quantity problems (an inefficient amount is provided). Embedding the provision game into a contest that rewards larger contributions with higher probabilities of winning a prize may remedy such failures. Applications include tenure decisions at universities, electoral competition among politicians, etc. We identify a tradeoff between the value of the prize and the decisiveness of the contest. High‐powered incentives in contests may cause an overprovision of the public good or wasteful participation of unproductive individuals in the contest.     

Shipping the Good Horses Out

The 1964 effect states that when a fixed per‐unit cost is added to two substitutes, the more expensive (higher quality) one becomes relatively cheaper, and, thus, its consumption will increase. When applied to trade in vertically‐differentiated goods, the importing regions demand relatively more high‐quality goods. We examine how this result changes when the importing region is also endowed with the goods. We use a vertically‐differentiated goods model with heterogeneous consumers in which prices are endogenously determined. We show that the importing regions with an endowment have a stronger Alchian‐Allen effect than the regions that are not endowed. We use the auction data of Australian thoroughbred yearlings to empirically test our model and find consistent empirical patterns.     

AID AND DEVELOPMENT IN AFRICA: THE DEBATE, THE CHALLENGES AND THE WAY FORWARD

The article discusses the emerging literature and debates on aid, within the context of expected increases in aid flows to the continent. The trends in ODA flows indicate a reversal in aid flows to the continent since 2000, with subsequent increases in aid intensity and dependence. Although the more recent literature on aid is doubtful if aid only spurs growth in a in a good policy environment, the aid‐institutional debate indicates a clear aid‐institutional paradox, especially relating to the macroeconomic effects, the fiscal response, the absorptive capacity and the good governance aid debates. The literature further indicates that aid could serve as a barrier to vulnerable societies. From the donors' perspective, it is evident that quantity of aid does not imply quality and that the ultimate responsibility lies with recipient governments to ensure more efficient absorption of aid.     

Aid for Trade in Developing Countries: Complex Linkages for Real Effectiveness*

Abstract: Aid for trade is intended to support the integration of developing countries into the world trading system. Although this form of aid is being hailed as a promising new development tool, it lacks the strategic dimension that it needs if it is to be truly effective and fulfill donors' policy commitments. From a theoretical perspective, this paper presents the various aid‐for‐trade categories and analyzes the linkages between foreign direct investment, aid for trade and development. It also presents a typology of trade‐related needs for a panel of countries, to serve as a guide for donors in formulating their aid supply strategies. This typology reveals a number of disparities between countries and regions, as well as a low level of regional integration. Trade‐related needs are particularly significant in West Africa and East Africa, and substantial in the infrastructure sector. This paper also stresses the importance of refining the formulation of actual demand by beneficiaries, structuring the aid supply in accordance with donors' specific areas of expertise and enhancing coordination among the various stakeholders, both public and private. Lastly, further trade liberalization will not by itself suffice to generate strong growth and improve the geographical and sectoral distribution of foreign direct investment. Factors such as political stability, the business climate, physical infrastructure, institutions and human capital also play a fundamental role. Of particular importance is the coherence of trade, sectoral, macroeconomic and tax policies, not only within each country and region but also between industrialized and developing countries.     

WELFARE GAINS OF AID INDEXATION IN SMALL OPEN ECONOMIES

Foreign-aid flows to poor, aid-dependent economies are highly volatile and pro-cyclical. Shortfalls in aid coincide with shortfalls in GDP and government revenues. This increases the consumption volatility in aid dependent countries, thereby causing substantial welfare losses. This paper finds that indexing aid flows to exogenous shocks, like a change in the terms of trade, can significantly improve the welfare of an aid-dependent country by lowering its output and consumption volatility. Compared to the benchmark specification with stochastic aid flows, indexation of aid flows to terms-of-trade shocks can reduce the cost of business-cycle fluctuations in the recipient country by 4% of permanent consumption. Moreover, use of indexed aid can allow donors to reduce the aid flows by 3% without lowering the level of welfare in the recipient country.     

Why are more redistributive social security systems smaller? A median voter approach

One of the stylized facts of unfunded social security programsis that programs are larger in size, measured relative to theGDP, the tighter the link between pension claims and past earnings.We provide a political economy explanation of this stylizedfact in a median voter model, where people vote on the socialsecurity tax rate. We compare pension systems with flat-rateand earnings-related benefit formulas. Only flat-rate benefitsredistribute within a generation from high to low income groups.If labor supply is endogenous, they also imply larger efficiencycosts than earnings-related schemes. Using data on eight Europeancountries, we find that the median voter is typically middle-agedwith high income. For these voters, earnings-related systemsare more attractive both because of less intragenerational redistributionand lower distortions in labor supply. The median voter modelis also able to account for a considerable degree of cross-countryvariation in contribution rates.     

EXPLORING THE SPECTRUM OF EXPORT DESTINATION: THE GEOGRAPHIC SPREAD OF KOREAN EXPORTS,ITS DETERMINANTS,AND POLICY IMPLICATIONS

Recent research in international trade has explored the stylized facts and causes and effects of export diversification. A simple model in this paper drawing on the work of Melitz suggests that there is an order in which a country spreads its goods to foreign countries. We estimate the order by using a methodology which takes account of the fact that most goods are not exported to several countries in our sample (unbalanced panel). We find that Korea exports its new goods first to the United States, followed by Japan, Hong Kong, and Singapore, and most recently to Bosnia-Herzegovina. Finally we find that the countries that Korea has exported to first are those with large GDP, low tariff rates, geographic proximity, language familiarity, in-country Korean export promotion offices, and high-quality institutions.     

垂直产品差异、外国企业纵向控制与研发政策

在Spencer和Brander(1983)模型的基础上,本文引入产品纵向控制因素,考虑生产高质量产品的非一体化企业与另一国生产低质量产品的一体化企业进行市场竞争时,政府的最优研发政策。在企业进行Cournot竞争的情形下,若产品质量差异较大(小),非一体化企业所在国政府的最优研发政策为征税(补贴),而在企业进行Bertrand竞争的情形下,非一体化企业所在国政府的最优研发策略则是征税。     

Fiscal innovation in nondemocratic regimes: Elites and the adoption of the prussian income taxes of the 1890s

The income tax is a central pillar of the modern fiscal state because of its revenue-raising capacity and administrative sophistication. Existing accounts point to interstate war and class conflict as key drivers of modern fiscal breakthroughs. In this article, we evaluate a third explanation for the origins of fiscal capacity that highlights the importance of intraelite competition for political and economic power in times of rapid industrialization. Modern forms of taxation generated a conflict between industry and agriculture over the distribution of the tax burden across sectors. The presence of electoral institutions that connected tax payments to voting rights created opportunities to overcome this sectoral divide and facilitated the formation of a political consensus for fiscal innovation. The political coalition supporting income tax adoption included higher-income industrial and agricultural elites who anticipated fiscal and electoral gains associated with the adoption of the new tax. Drawing on parliamentary debates in Prussia and additional district-level data, we document both the origins and electoral and economic consequences of the new income tax. We show that the adoption of a highly sophisticated income tax in 1891 shifted the tax burden from land to industry and diluted the political influence of the middle class. The findings clarify the coalitional dynamics leading to fiscal tax adoption in nondemocratic contexts.     

Testing Conflicting Political Economy Theories: Full‐Fledged versus Partial‐Scope Regional Trade Agreements

We apply a duration analysis to test the conflicting predictions of the median voter model and the lobbying model using panel data on regional trade agreement (RTA) formation. Our results show that the pro‐labor prediction of the median voter model is supported by the full‐fledged free trade areas and customs unions (FTAs/CUs), while the pro‐capital prediction of the lobbying model is supported by the partial‐scope preferential trade arrangements among developing countries. This finding holds better for the country pairs with more different capital‐labor ratios as a result of the stronger distributional effects of RTAs. The support for the median voter model (lobbying model) is stronger when the two countries in a pair have left‐oriented (right‐oriented) governments. I also find stronger support for the median voter model for the subset of FTAs/CUs with service coverage and stronger support for the lobbying model for countries that place higher weight on political contribution.     

The impact of disinvestment and the debt crisis on the South African economy

The paper considers the economic implications of disinvestment and the debt crisis for the South African economy with the aid of some historical analysis of foreign capital inflows and growth. It considers the changes that have occurred in the structure of foreign liabilities over the last twenty years and it examines the quantitative and qualitative roles of private investment and non‐direct investment over this period. The debt issue is examined within the framework of disinvestment, and the conclusion reached is that the economic problems consequent to a withdrawal of foreign loans pose a far greater threat to the South African economy than the loss of foreign direct investment. We assume that disinvestment is not accompanied by any official trade embargo, and the controversy surrounding the relationship between economic growth and social and political change in South Africa is ignored.     

Aid Volatility and Real Business Cycles in a Developing Open Economy

This article analyzes the impact of the unpredictability of foreign aid on macroeconomic fluctuations in the recipient country. I build a small open‐economy business cycle model that accounts for foreign aid shocks, with no preference shocks. The model is calibrated to reflect the structural empirical regularities of Cote d'Ivoire, a typical aid‐dependent developing country. The parameters of the exogenous shocks are estimated using Bayesian methods and time series data for Cote d'Ivoire. The model produces business cycle patterns that are consistent with the data and key stylized facts. Specifically, the excess volatility of consumption with respect to output is successfully replicated. The results suggest that the unpredictability of foreign aid contributes to explain the volatility of business cycles in the recipient economy and has negative welfare effects.