Vertical externalities and control of politicians

A major role of (repeated) elections is to create incentives for politicians to act in the interests of voters. This paper considers the disciplining role of elections in countries with either one or two levels of government. Simple retrospective voting strategies which are based on cut-off levels with respect to expenditure and tax rates are considered. It is shown that the power of voters is weakened if a second independent level of government is added. However, voters can partially reinforce their power by making politicians not only liable for their own policy, but also for the policy carried out at each other level of government. Received: June 30, 2000 / Accepted: April 4, 2001     

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.     

An economic offer they cannot refuse! Economic expectations on incumbent government support in Core and periphery European countries

The importance of economic conditions on election outcomes is well established. This paper supplements the standard approach to economic voting by assessing government support from a highly debated perspective of European spaces: Core countries and Periphery countries (Central Eastern European and Southern countries). The paper reveals that the economic conditions perceived by voters in the future are expected to differently affect incumbent government support depending on the macroeconomic position of the country. This paper finds that, contrary to Core countries' electors, voters in periphery countries are keener to support the incumbent governments if the economic outputs are positive. It concludes that positive economic expectations are strongly and positively associated with incumbent government support, regardless of previous vote choice, while negative economic expectations are strongly and negatively associated with government support.     

Information distortion and competitive remedies in government transfer programs: The case of ethanol

This paper reconsiders the analogy between competitive markets and the political process that is central to much of the literature on the efficiency of government transfers. The key problem is that property rights in politics are much less well defined than they are in competitive markets. As the paper outlines, obtaining accurate information about the benefits and costs of transfers is likely to be much more difficult than envisioned in the literature. Investigators, as well as general voters, often must rely on the government and competing parties for provision of information about underlying program parameters and functional relationships. We argue that politicians and the affected interest groups have incentives to limit and distort the information that is released to voters and that political competition is unlikely to be an effective counter. In developing the argument, a theoretical framework is provided and applied in a case study of the ethanol transfer. The documented efforts to disguise the actual costs and benefits of the program are important for gaining a broader understanding of the functioning and costs of government transfers in the economy.     

THE POLITICAL ECONOMY OF OVERLAPPING JURISDICTIONS AND THE FRENCH/DUTCH REJECTION OF THE EU CONSTITUTION

In seeking to protect their failed social model by rejecting the EU constitution, French and Dutch voters ironically contributed to promoting the very 'liberal' order they misunderstand and despise. When, as in federalist politics, functions overlap, two levels of government compete for the same votes in the same territory in the supply of similar services. Not unlike the tragedy of the commons in oil extraction, it is in the interest of both political authorities to seek to gain votes in implementing the programme first. The overall equilibrium supply of public services is excessive and both levels of government have a tendency to invade every field. Short of effective constitutional limits on the powers of the central government, a more decentralised EU offers an opportunity to overcome the common-pool problem of multi-level government.     

Impossibilities for strategy-proof committee selection mechanisms with vetoers

When a group of voters selects a committee out of a set of candidates, it is common and often desirable to endow these voters with some veto power. I present impossibility results showing that even limited veto power makes many mechanisms of interest manipulable. This applies in particular (i) to mechanisms the range of which contains a degenerate lottery in which a committee is chosen for sure and (ii) to mechanisms that are constructed from extensive game forms with a finite number of strategies. These impossibilities hold on a large set of domains including the domain of additive preferences, and even when probabilistic mechanisms are allowed and voters can report cardinal preferences.     

Centralisation is no Solution

Although the US structure of government encourages the activity of presure groups more than in the UK, argues Rosalind Levaćić of the Open University, orchestrated campaigns to put pressure on government have spread in Britain, especially in education and health, where they will now prevent direct central government control of resources from being as effective as decentralising control to individual consumers/voters.     

The influence of poll results on public opinion: Examining the personal consequences of the poll topic

A laboratory experiment examined the effect of reporting poll results on opinions regarding a legislative proposal affecting higher education. The results indicated that exposure to poll results was more likely to change opinions when the proposal had few personal consequences, and when the majority position in the polls was counter to the opinions held by most subjects. Under these conditions, a ‘bandwagon effect’ resulted wherein subjects tended to switch to the majority position reported in the polls. However, when the personal consequences of the proposal were substantial, and/or the majority position was consistent with the views of most subjects, poll results had little or no impact on opinions. These results suggest that, in certain circumstances, reported poll results are viewed as an acceptable basis for opinions on government policies, and that governments can use poll results strategically to sway the opinions of voters - especially voters who are relatively unaffected by the policy.     

Impacts of Reduced Gaming Exports on the Economy of Nevada

Previous studies of gaming have not calculated numerically the negative, economy-wide impacts on the Nevada economy from potential expansion of the gaming industry outside of the state. This study uses a state-level, two-sector computable general equilibrium (CGE) model of Nevada to investigate such impacts. In the Nevada CGE, both commodity prices and factor prices are endogenously determined and the impacts on major economic variables such as output, employment, and government revenue are estimated. Three different model variants are specified. Each variant is based on different assumptions regarding intersectoral and interregional factor mobility to analyze model sensitivity. Results show that the impacts on Nevada of the nationwide expansion of gaming could be significant under reasonable assumptions about factor mobility for Nevada. Also, results for total regional output and total government revenue are found to be very sensitive to the alternative factor mobility assumptions.     

Does government ideology influence budget composition? Empirical evidence from OECD countries

This paper examines whether government ideology has influenced the allocation of public expenditures in OECD countries. I analyze two datasets that report different expenditure categories and cover the time periods 1970–1997 and 1990–2006, respectively. The results suggest that government ideology has had a rather weak influence on the composition of governments’ budgets. Leftist governments, however, increased spending on “Public Services” in the period 1970–1997 and on “Education” in the period 1990–2006. These findings imply, first, that government ideology hardly influenced budgetary affairs in the last decades, and thus, if ideology plays a role at all, it influences non-budgetary affairs. Second, education has become an important expenditure category for leftist parties to signal their political visions to voters belonging to all societal groups.     

Political Ambivalence vs. Economic Rectitude

Pressures from bureaucracy and voters alide for disbursements from the 'public' purse carry much more political force than the desire to reduce government expenditure. Cecil Parkinson, Secretary of State for Trade and Industry in 1963, Considers the interests in the formulation of spending plans and argues that the politicion willpuf political feasibility before economic desiderato.     

SWITZERLAND: GROWTH OF GOVERNMENT, GROWTH OF CENTRALISATION

Switzerland has a tradition of decentralised government, decentralised tax setting and direct reference to the voters through referendums. Such mechanisms should give rise to lower taxes, better provision of public goods and higher economic growth. However, these mechanisms have not been effective in the last 30 years at preventing the growth in government spending and centralisation. This is partly because of the consensus in favour of centralisation that exists among institutionalised politicians. The performance of the Swiss economy since 1970 has consequently been dismal. Real per capita post-tax incomes have been stagnant. There is now an opportunity for the growth of centralisation to be reversed.     

关于我国政府会计假设与前提的思考

从计划经济时期起至今,我国政府会计并不重视会计假设与前提。这其中的原因与我国政府产权关系、财政类型及宪政水平有着密切的关联。我国政府产权关系的变迁、公共财政制度改革及宪政水平的提高引发了人们对政府会计假设与前提的关注。我国政府会计应引入规范性的假设与前提,并从政府会计制度安排上充分重视会计假设与前提。     

Federalism,distributive politics and representative democracy

We analyze federal systems of government in which local public policies are financed by general taxation. In a decentralized political system there is, in each region, a vote to elect a local representative while in a centralized political system a single representative is elected by a federal vote. It is shown that under decentralization, voters strategically elect liberal representatives so as to nullify any element of cooperation between representatives in the decision-making stage. Thus, there is a trade-off between the budgetary externality and a "policy closer to the people", but the democratic choice is biased towards decentralization.     

A methodology for testing a new spatial model of elections

The purpose of this paper is to offer a methodology for testing a new spatial theory of elections. Specifically, it is shown that the new spatial model of elections developed by Enelow and Hinich (1984a) is statistically equivalent to assuming that a classical factor structure underlies the data that voters provide concerning the issue positions of themselves and the candidates. A factor analysis of the sample correlation matrix of candidate variables averaged over voters and issues provides consistent estimates of the candidate locations in the space of predictive dimensions postulated by Enelow and Hinich, and the facor scores assigned to the voters can be used to project the voters onto the same predictive space with the candidates. This new scaling method is used to locate the positions of voters and candidates in the underlying predictive space of the 1980 Presidential election. Internal checks confirm the empirical adequacy of the candidate locations, and probit analysis is used as an external check on the empirical adequacy of the voter locations. For the pre-election data, no loss of accuracy in predicting voter choice was found in moving from the issue data to the estimated factor locations of voters and candidates. For the post-election data, a modest drop in accuracy was discovered. Overall, the empirical adequacy of factor analysis was confirmed as a methodology for testing the new Enelow-Hinich spatial model of elections.     

Intergenerational conflict and the political economy of higher education funding

We examine how a population's age distribution and a growing divide between the ethnic composition of older and young generations is likely to affect support for higher education funding. Using detailed survey data on voter preferences for higher education funding and precinct-level vote returns from locally-funded community college bond referenda in California, we find that older voters are significantly less supportive of higher education funding than younger voters and that support among older non-Hispanic white voters is particularly weak when those voters reside in a jurisdiction where the college-age population is more heavily Hispanic.     

Ambiguity in Electoral Competition

The paper proposes an explanation to why electoral competition induces parties to state ambiguous platforms even if voters dislike ambiguity. A platform is ambiguous if different voters may interpret it as different policy proposals. An ambiguous platform puts more or less emphasis on alternative policies so that it is more or less easily interpreted as one policy or the other. I suppose that a party can monitor exactly this platform design but cannot target its communications to individuals one by one. Each individual votes according to her understanding of the parties’ platforms but dislikes ambiguity. It is shown that this electoral competition has no Nash equilibrium. Nevertheless its max–min strategies are the optimal strategies of the Downsian game in mixed strategies. Furthermore, if parties behave prudently enough and if the voters aversion to ambiguity is small enough, these strategies do form an equilibrium.     

Modeling undecided voters to forecast elections: From bandwagon behavior and the spiral of silence perspective

Forecasting election results has been a highly attractive activity among political and social scientists. Different forecasting methods have been proposed, but those based on public opinion polls are the most common. However, there are challenges to using opinion polls, especially because they neglect undecided voters. Due to the significant number of undecided participants and their impact on voting outcomes, we analyze the potential behavior of undecided voters by considering opinion polls and sentiment based on voter expectation from the perspective of the bandwagon effect and the spiral of silence. We establish a hierarchical Bayesian forecasting model to predict voting results, and apply it to the 2016 United States presidential election and the 2016 Brexit referendum. The results of our model suggest that voting outcomes are more predictable when fully utilizing the impact of undecided voters. The results indicate that integrating aggregated polls into the hierarchical Bayesian framework is a strong predictor for forecasting outcomes, and they provide evidence for the influence of sentiment based on voter expectation in forecasting election results.     

Administrative interdependence: Measurement and applications

The object of the paper is to apply the methods used in the analysis of input-output tables to the study of interdependence among the different subdivisions of organizations. The term “organizations” is used in a generalized sense that includes examples ranging from, say, a small industry to a country's government. The bases for the analysis are the assumptions that: (a) it is possible to identify the contribution that each subdivision of the organization makes to the other subdivisions: and (b) it is possible to identify the contribution of the organization to its social environment.With the assumptions mentioned above, the methods of input-output analysis can be applied in order to estimate changes in size that should occur in an organization when demands from its environment change. Indices of model in which the methods developed for the study of Flow of Funds matrices are applied to the study of organizations.Data from the Federal Government of the U.S., subdivided into 25 departments and from the Mexican National Productivity Center are used to construct examples of the models presented and their applications.     

Endogenous party structure

This paper proposes a model of two-party representative democracy on a single-dimensional political space, in which voters choose their parties in order to influence the parties’ choices of representative. After two candidates are selected as the median of each party’s support group, Nature determines the candidates’ relative likability (valence). Based on the candidates’ political positions and relative likability, voters vote for the preferable candidate without being tied to their party’s choice. We show that (1) there exists a nontrivial equilibrium under natural conditions, and (2) the equilibrium party border and the ex ante probabilities of the two-party candidates winning are sensitive to the distribution of voters. In particular, we show that if a party has a more concentrated subgroup, then the party tends to alienate its centrally located voters, and the party’s probability of winning the final election is reduced. Even if voter distribution is symmetric, an extremist party (from either side) can emerge as voters become more politically divided.