Experimental evidence that quorum rules discourage turnout and promote election boycotts

Many democratic decision making institutions involve quorum rules. Such rules are commonly motivated by concerns about the “legitimacy” or “representativeness” of decisions reached when only a subset of eligible voters participates. A prominent example of this can be found in the context of direct democracy mechanisms, such as referenda and initiatives. We conduct a laboratory experiment to investigate the consequences of the two most common types of quorum rules: a participation quorum and an approval quorum. We find that both types of quora lead to lower participation rates, dramatically increasing the likelihood of full-fledged electoral boycotts on the part of those who endorse the Status Quo. This discouraging effect is significantly larger under a participation quorum than under an approval quorum.     

Government Purchases, Government Transfers, and the Post-1970 Slowdown In U.S. Economic Growth

This article shows that the post-1970 slowdown in U.S. economic growth can be explained by a shift in fiscal policy away from government purchases and toward transfer payments. Two endogenous growth models that include government purchases and transfers imply a relationship between these variables and long-run growth. Empirically, the simultaneous decline in the fraction of output purchased by federal, state, and local governments and rise in transfer payments around 1970 dramatically overpredict the growth slowdown of the early 1970s. The growth rate is predicted to have risen in the absence of this change in fiscal policy.     

The microfoundations of rules vs. discretion

Using anN-person model, I explore the microfoundations of benevolent rules-dominant situations (of which the familiar time inconsistency models are examples). I show that under discretion the citizens confront a prisoner's dilemma, and I discuss the similar dilemmas embedded in the time inconsistency models. I then suggest new solutions to benevolent rules dominance: suboptimality can be avoided by accepting the discretionary regime and applying to the citizen population the standard remedies to the prisoner's dilemma. I received valuable comments from C. de Bartolome, T. Cowen, S. Fischer, B. Hillier, A. Irigoin, R. Kroszner, B. O'Flaherty, J. Ordover, H. Polemarchakis, R. Radner, A. Schotter, L. Svensson, L.H. White, three anonymous referees, and the participants of a summer luncheon at the Public Choice Center, George Mason University.     

Descent rules and strategic transfers. Evidence from matrilineal groups in Ghana

Traditional descent systems can roughly be divided into patrilineal and matrilineal. In the latter, a man's heir is not his own child but rather his sister's son. The paper examines the implications of this social norm for the pattern of inter-vivos transfers using household level data from rural Ghana, where the largest ethnic group is traditionally matrilineal. In particular, it tests the predictions of a model of strategic behavior according to which children should respond to the threat of disinheritance by increasing transfers to their parents during lifetime to induce a donation of land before the default (matrilineal) inheritance is enforced. I find that the credibility of customary norms enforcement, as proxied by the presence of a nephew in the father's household, significantly increases the probability of receiving transfers from children for Akans but not for the other groups. The effect is specific to nephews and not to other co-resident boys. This pattern of behavior can affect asset accumulation decisions across generations.     

Evaluating monetary policy with financial stability objective: rules vs. discretion

This article explores whether adding the goal of financial stability to the more traditional goals of output and price stability could improve optimality of monetary policy. A Dynamic Stochastic General Equilibrium model that endogenously incorporates financial frictions is used to derive optimality conditions across rule-based and discretionary monetary policy environments. The results indicate that it is optimal for the Central Bank to keep output below the potential level in the short term so as to dampen the inflationary effects arising from supply and financial shocks. When the economy is exposed to a financial shock, both leverage and credit spread rise significantly, thereby tipping the economy into a financial crisis and raising the probability of macroeconomic risk.     

Crafting social rules: Common law vs. statute law,once again

While a considerable literature has arisen seeking to compare the economic efficiency of common law and statute law processes, some scholars have argued that these efforts are misplaced because what should be assessed is not efficiency but stability of expectations. This paper argues that any generic comparison of common law and statute law must be inconclusive, because there is no such thing asthe common law or statute law process. Rather, there are many particular processes, and any claim based on a comparison of generic alternatives will falter because it will fail to reflect essential institutional detail. I am grateful to Charles K. Rowley and Viktor J. Vanberg for valuable comments on an earlier version of this paper, and to the Lynde and Harry Bradley Foundation for its continuing support of my scholarly efforts. I am also grateful to Robert J. Staaf for advice and encouragement on many occasions over the years, traces of which, I am confident, are evident here.     

Patient care automation: the future is now. Part 3. The five rules of automation

Five key principles for creating effective operations optimization-based patient care automation have now been established: (a) The old system architectures did not provide operations optimization; (b) primary patient care optimization (nurses and doctors) must be the central focus of any effective system; (c) the system must provide a platform that allows for eliminating both the retrospective and prospective (subterranean) paper records; (d) point-of-care data capture, including at the bedside, must be provided; and (e) integration around the patient is critical to success. Systems that ignore these principles will ultimately be doomed to repeat the problems of the manual system. Adherence to these principles opens a myriad of possibilities and provides a road map for how such a system should function. The next installment in this series of articles will address the ramifications of integration in system design and system use. The positive effects that such system designs can have on the realization of demonstrable benefits from system technology will also be reviewed.