Private polling in elections and voter welfare

We study elections in which two candidates poll voters about their preferred policies before taking policy positions. In the essentially unique equilibrium, candidates who receive moderate signals adopt more extreme platforms than their information suggests, but candidates with more extreme signals may moderate their platforms. Policy convergence does not maximize voters' welfare. Although candidates' platforms diverge in equilibrium, they do not do so as much as voters would like. We find that the electorate always prefers less correlation in candidate signals, and thus private over public polling. Some noise in the polling technology raises voters' welfare.     

Xenophobia and the Size of the Public Sector in France: A Politico-economic Analysis

Anti-immigrant feeling (xenophobia) among voters was a key factor in the second-place victory of Jean Le Pen's National Front Party in the 2002 French national election. Here, we study the effect of anti-immigrant sentiment on the equilibrium position of political parties on the economic issue, which we take to be the size of the public sector. We model political competition among three parties (Left, Right, and Extreme Right) on a two-dimensional policy space (public sector size, immigration issue) using the PUNE model. We calibrate the model to French data for the election years 1988 and 2002, and show that politics have changed significantly over this period, from being centered primarily on economic issues, to non-economic issues such as immigration and security/law-and-order. We estimate that in 2002, the effect of voter xenophobia was to reduce the voters' choice of public-sector size between 11% and 28% of one standard deviation of the population's distribution of public-sector size ideal points, from what it would have been, absent xenophobia.     

Subsidizing power

This study explores whether the amount of fossil fuel subsidies paid by the government is subject to an election cycle. Theoretically, it is not a priori directly clear whether the provision of fossil fuel subsidies should go up or down when elections are upcoming. On the one hand, governments may reap electoral benefits from offering additional support in an election year since voters generally prefer candidates from whom they expect to receive greater material well-being by reducing the prices of basic goods. On the other hand, if the number of recipients is only small or when they are politically not well organized, reducing fossil fuel subsidies to finance a tax cut or an increase in other public spending areas that benefit and attract more voters might be a more successful re-election strategy. My main empirical findings clearly show a U-shaped election effect. It turns out that election cycles encourage fossil fuel support only in countries that have either a large or small fossil fuel demand. In these countries, governments are more inclined to provide additional fossil fuel support in an election year. In turn, I do not find any significant evidence for the notion that upcoming elections create a window of opportunity to reduce fossil fuel subsidies. Finally, the significant election effects are in particular visible during presidential elections.     

Candidate strategies in primaries and general elections with candidates of heterogeneous quality

I consider a model in which candidates of differing quality must win a primary election to compete in the general election. I show that there is an equilibrium in which Democrats choose liberal policies and Republicans choose conservative policies, but higher quality candidates choose more moderate policies than lower quality candidates. In this equilibrium, higher quality candidates choose more moderate policies if they have a larger quality advantage or there is less uncertainty about the median voterʼs ideal point in the general election, and the candidates in a given primary choose closer policies to one another when there is a smaller quality difference between the candidates in a primary. I further show that if the candidates have policy motivations, then a low quality candidate may strategically choose to enter a primary even if running for office is costly and the candidate will lose the primary election with certainty in equilibrium.     

On the Likelihood and Welfare Effects of "Stop–and–go" Policies

Baleiras and Santos (2000) show that "stop–and–go" policies may be inherent in the institutional set–up rather than result from the wrong timing of expansionary vs. contractionary policies or any form of players' irrationality. We use this set–up, involving ultrarational players and perfect foresight, to show that stop–and–go policies are more likely (in a statistical sense) than the opposite type of phenomenon. Moreover, it is shown that having the voters' and the business community's preferences concerning the cycle converge to the socially optimal cycle pattern may entail a welfare loss.     

Understanding the election results in Portugal

The great majority of the theoretical analyses about electoral cycles has considered the national space as the territory of interest when studying the economic consequences of an electoralist behaviour by the central government. This fact, in conjunction to the nature of the data most commonly available, has lead many authors to empirical studies that test the evidence of electoral cycles mostly at a national level. Given that the election results for the main parties, at least in Portugal, clearly reflect some spatial localisation we find rather intriguing to verify that so very few of those empirical studies use spatial econometrics techniques. The main objective of the paper is to detect empirical evidence supporting the existence of a link between voters' ideology and the 2002 election results obtained by the two main parties in Portugal. The confrontation of the spatial econometric results with the ones obtained ignoring the spatial localisation of the data shows that, in order to better understand the election results, space must be taken into account.     

Relative consumption and majority voting: supplementing Oates’ “Decentralization Theorem”

This paper reconsiders the question of whether centralized or decentralized provision of local public goods is preferable, taking into account two new elements: the appearance of relative consumption effects and the possibility of an inefficient election outcome due to a right-skewed income distribution. Surprisingly, our results indicate that (1) decentralization may lead to a strictly higher welfare level than centralization, even if regions are homogeneous, and (2) under certain circumstances centralization may be welfare superior, even though traditional public good spillovers are not considered in our framework. Whether centralization or decentralization is preferable crucially depends on the extent to which social interaction takes place between regions.     

The Effects of Fiscal Consolidation and Welfare Composition of Spending on Electoral Outcomes: Evidence from US Gubernatorial Elections between 1978 and 2006

This study attempts to make a contribution to the field of spending aspects of fiscal policy and their impacts on electoral outcome. Due to varying degrees of financial responsibilities and commitments to provide public goods and services, US state governments serve as a perfectly natural laboratory to test the electoral significance of fiscal policies. We adopt a probit model, with several specifications, to determine significant impacts of fiscal consolidation and increases in welfare spending on US gubernatorial elections from 1978 to 2006. The analyses show that voters are more concerned about the increase in debt than current budget deficits. An increase in welfare spending is negatively associated with reelection. Moreover, the impact of taxation on gubernatorial elections turns out to be insignificant. In particular, findings suggest that the political business cycle model does not hold true in US gubernatorial elections. Expansionary fiscal policy right before the election may not have crucial impacts on the chances of an incumbent winning the election.     

The Borda method is most likely to respect the Condorcet principle

Summary We prove that in the class of weighted voting systems the Borda Count maximizes the probability that a Condorcet candidate is ranked first in a group election. A direct result is that the Borda Count maximizes the probability that a transitive, binary ranking of the candidates is preserved in a group election. A preliminary result, but one of independent interest, is that the Borda Count maximizes the probability that a majority outcome betweenany two candidates is reflected by the group election. All theorems are valid when there is a uniform probability distribution on the voter profiles and can be generalized to other uniform-like probability distributions. This work extends previous results of Fishburn and Gehrlein from three candidates to any number of candidates.This work is a portion of my doctoral dissertation The Geometric Investigation of Voting Techniques: A Comparison of Approval Voting, Positional Voting Techniques and the Borda Count written under Don Saari at Northwestern University, Evanston, Illinois.     

A Model of a Predatory State

We provide a model of a primitive state whose rulers extorttaxes for their own ends. This "predatory" state can resultin lower levels of both output and popular welfare than eitherorganized banditry or anarchy. The predatory state may providepublic goods, such as protection, and hence may superficiallyresemble a contractual state. But the ability to provide suchgoods can actually reduce popular welfare after allowing fortax changes. Moreover, the kinds of public goods that predatorystates provide are those that increase revenue, not necessarilywelfare. We consider when primitive states are likely to emergefrom organized banditry, and argue that poverty may result instatelessness rather than vice versa. We show that even a weakstate (in transition from banditry) can be bad for output andwelfare, and that a "corrupt" state that makes side deals withbandits is especially bad.     

Information Manipulation in Election Campaigns

We provide a game‐theoretical model of manipulative election campaigns with two political candidates and a Bayesian voter. The latter is uncertain about how good the candidates are. Candidates take unobservable, costly actions to manipulate voter's opinion about their positions. We show that if the candidates differ in campaigning efficiency, and the voter receives the biased campaign messages with some noise, then the cost‐efficient candidate can win the election with higher probability than her opponent even when she is ex‐post an inferior choice for the voter. Our paper offers a novel informational justification for imposing limits on campaign spending and encouraging diversity in the supply of political information.     

Welfare Reducing Polls

We study costly majority voting when voters rationally anticipate others have similar preferences. The correlation in preferences lowers expected turnout because votes have a positive externality on those who abstain. We study the effects of the public release of information (polls) on participation levels. Polls raise expected turnout but reduce expected welfare because they stimulate the “wrong” group to participate resulting in a “toss-up” election. Our novel results highlight the adverse effects of providing information about the electorate’s preferences and may explain why some countries bar opinion polls close to an election date.     

Campaign Contributions with Swing Voters

We analyze contributor behavior when there are two types of voters: positioned voters, who care about the ideological positions of candidates, and swing voters, who care about only the leadership abilities of candidates. Campaign expenditures, which are funded by contributions, are assumed to influence voters' perceptions of a candidate's ability. We find that the number of swing voters may have unexpected consequences on equilibrium campaign contributions. In particular, total contributions may increase as the number of swing voters decreases.
Elections are won by doing two things: mobilizing your base and winning the independent swing voters.
(Karl Rove, campaign strategist for George W. Bush)     

Registered nurses' perspectives on health care and the 2008 presidential election

As this historic presidential election draws near, what do RNs think of our nation's priorities? Which candidates do they think will be most effective in shaping our health care system and addressing the most pressing issues of our time? The results of this survey show that RNs do not identify overwhelmingly with one political ideology or party and, in fact, they closely resemble the public on these political dimensions. The data also show that RNs identify health care issues as the most important problem facing the nation. RNs who believe that it is the responsibility of the government to provide health insurance to those without it, have more confidence in the government to achieve this outcome, and are more likely to be Democrats than Republicans. The presidential election is expected to be highly contested and could be determined by a relatively small margin of votes and, thus, nurses should recognize their chances of influencing the outcome of the election. The data from this survey provide baseline information potentially useful to increasing the political influence of the nursing profession, informing other organizations about where they might align with nurses, and helping candidates and the political parties compete more effectively in seeking the support of roughly 3 million RN voters.     

Flip-flopping from primaries to general elections

I consider a model in which candidates must win a primary election to compete in the general election. Candidates may choose different policies in the primary and the general election, but doing so results in accusations of flip-flopping. I show that candidates adopt extreme policies in the primaries but then try to move closer to the center for the general election even though primary voters are forward-looking and anticipate this policy moderation. The extent to which candidates move closer to the center is constrained by flip-flopping costs, and candidates choose divergent policies in the general election. I obtain comparative statics results on candidate policy choices in terms of voter preferences.     

LOBBYING AND ELECTIONS

I analyse the interaction between post‐election lobbying and the voting decisions of forward‐looking voters. The existing literature has shown that in models with citizen candidates from a dispersed distribution of preferences, lobbying has no influence on implemented policy. In my model with ideological parties, lobbying is shown to have an effect on policy. In terms of welfare, I show that the median voter and the majority of voters can be better off with lobbying.     

Manipulation through political endorsements

We study elections with three candidates under plurality voting. A candidate is a Condorcet loser if the majority of the voters place that candidate at the bottom of their preference rankings. We first show that a Condorcet loser might win the election in a three-way race. Next we introduce to the model an endorser who has private information about the true probability distribution of the preferences of the voters. Observable endorsements facilitate coordination among voters who may otherwise split their votes and lead to the victory of the Condorcet loser. When the endorser has an ideological bias towards one of the candidates, the coordination impact of endorsements remains unaltered, moreover the endorser successfully manipulates the outcome of the election in favor of his bias, even if his ideological bias is known by the voters. The results are true for any endorsement cost and any magnitude of bias as long as the electorate is large enough.     

Seigniorage and public good in an OLG model with cash-in-advance constraints

This paper is a contribution to the theory of the optimal monetary policy in overlapping generations models with a cash-in-advance constraint applying on old age consumption purchases. We are particularly interested in the study of seigniorage when the latter is used to finance public goods valued by consumers. Assuming that a public good enters the utility function and the existence of cash-in-advance constraints, we find a Laffer curve of seigniorage at steady-state. We also analyze the dynamic optimal monetary policy when the government maximizes an intertemporal social welfare function and can only resort to seigniorage to finance the purchases of the public good. We show that the optimal rate of money growth may be strictly higher than the one which maximizes steady-state seigniorage: the optimal amount of seigniorage may lie on the decreasing part of the Laffer curve of seigniorage. We finally suppose that the government can use lump-sum taxes in addition to seigniorage. Then, the Friedman rule prevails and public expenditures are only financed through lump-sum taxes.     

Service Quality,Competition, and Regulatory Policies in the Postal Sector

This paper presents a simple model which illustrates the possible policy- and welfare-implications of endogenous product selection in the postal sector. The cost of a unit of mail depends on its "quality" (e.g., speed of delivery) and on the type and location of the addressee (firms, urban households, and rural households). Senders have inelastic demands and differ in their willingness to pay for quality. Addressees are passive but their utility may affect social welfare. Two operators play a two-stage game, first choosing qualities and then prices. We first show that the equilibrium with two private (profit maximizing) operators results in an inefficient provision of quality. Then, we consider the mixed (Nash) equilibrium with one private and one (welfare maximizing) public operator. If the budget constraint of the public firm is not binding, this equilibrium is shown to be first-best efficient even if social welfare accounts for the utility of addressees. If the budget constraint is binding, the mixed equilibrium is not efficient but yields a higher level of welfare than the private equilibrium. Finally, we study the impact of minimum quality standards within our setting.