The disadvantage of winning an election

This paper analyzes the problem that an incumbent faces during the legislature when deciding how to react to popular initiatives or policy proposals coming from different sources. We argue that this potential source of electoral disadvantage that the incumbent obtains after being elected can jeopardize the reelection possibilities of the incumbent. We analyze the decision of the incumbent when facing reelection and we characterize the conditions under which the advantages that the incumbent obtains can overcome the disadvantages. Finally, we use the results of this analysis to discuss some implications of the use of mechanisms of direct democracy like referenda and popular assemblies on electoral competition.Incumbency advantage, Referenda, Popular initiatives, Elections.

Democracy, credibility and clientelism

The authors demonstrate that sharply different policy choices across democracies can be explained as a consequence of differences in the ability of political competitors to make credible pre-electoral commitments to voters. Politicians can overcome their credibility deficit in two ways. First, they can build reputations. This requires that they fulfill preconditions that in practice are costly: informing voters of their promises; tracking those promises; ensuring that voters turn out on election day. Alternatively, they can rely on intermediaries -- patrons - who are already able to make credible commitments to their clients. Endogenizing credibility in this way, the authors find that targeted transfers and corruption are higher and public good provision lower than in democracies in which political competitors can make credible pre-electoral promises. The authors also argue that in the absence of political credibility, political reliance on patrons enhances welfare in the short-run, in contrast to the traditional view that clientelism in politics is a source of significant policy distortion. However, in the long run reliance on patrons may undermine the emergence of credible political parties. The model helps to explain several puzzles. For example, public investment and corruption are higher in young democracies than old; and democratizing reforms succeeded remarkably in Victorian England, in contrast to the more difficult experiences of many democratizing countries, such as the Dominican Republic.Environmental Economics&Policies,Decentralization,Election Systems,Economic Theory&Research,Labor Policies,Economic Theory&Research,Environmental Economics&Policies,National Governance,Parliamentary Government,Politics and Government

Instituciones políticas, procesos de diseño de políticas y resultados de las políticas en Uruguay

Uruguay genera una variedad de resultados políticos. Primero, hay políticas relativamente estables que permiten la apertura comercial y financiera del país. También, hay políticas de baja calidad e inflexibles relacionadas con políticas sociales, algunas áreas de reforma estatal (los salarios de los funcionarios del estado y mecanismos de contratación), el régimen de bancarrota, etc. Finalmente, estan los resultados volátiles que son generalmente los efectos de choques económicos, algunas veces relacionados con los gastos públicos. En los casos en que hay un precedente histórico o que la disponibilidad de mecanismos externos de cumplimento no conducen a políticas relativamente estables, la principal característica saliente de las políticas Uruguayas es la rigidez. La fuente de rigidez de las políticas Uruguayas parece ser una mezcla de factores institucionales (múltiples vetos, partidos fraccionados, y mecanismos de democracia directa) y conflictos políticos (preferencias de políticas divergentes), en los cuales es muy costoso moverse del status-quo debido a la gran amenaza de un reverso de las políticas. Las instituciones políticas en el Uruguay son propicias a alcanzar un acuerdo político a corto plazo, pero no pueden cooperar efectivamente y establecer políticas estables y flexibles al largo plazo. La dificultad está en conseguir intercambios políticos ínter temporales que son consistentes con las principales características del ambiente político: una cifra alta de principales actores políticos y vetos, una cifra considerable de maniobras políticas inobservables, una pobre aplicación de tecnología en el área económica, una burocracia políticamente influenciada, intercambios políticos que ocurren fuera del ruedo legislativo, y una particular constelación de partidos y preferencias además de un diseño costoso de políticas y cambios institucionales. (Disponible en Inglés)

Downsian competition in the absence of a Condorcet winner

This paper studies studies two-party electoral competition in a setting where no policy is unbeatable. It is shown that if parties take turns in choosing platforms and observe each other's choises, altering one's platform so as to win is pointless since the other party never accepts an outcome where it is sure to loose. If there is any cost to changing platform, the prediction is that the game ends in the first period with the parties converging on whatever platform the incumbent chooses. If, however, there is a slight chance of a small mistake, the incumbent does best in choosing a local equilibrium platform. This suggest that local equilibrium policies can be the predicted outcome even if the voting process is not myopic in any way.Voting; Downsian competition; Local equilibrium; Spatial trembles

The politics of municipal fragmentation in Ghana

The scholarly debate over the rival merits of local government consolidation and fragmentation is an old but enduring one. However, in this debate very little attention has been focused on the political dimension of council amalgamation and fragmentation – yet political considerations play a central role in both the formulation and outcomes of de-concentration policy. The purpose of this article is to fill a gap in the literature by examining local government fragmentation in Ghana from 1988 to 2014. The article does this by identifying the key players and analysing their interests and gains, as well as the tensions arising from the fragmentation exercise. The implications from the Ghanaian case for more general theories of fragmentation are drawn out

The Politics of Economic Reform in Thailand: Crisis and Compromise

What explains the varying responses by Thai governments to changes in the international economic environment over time. To answer this the paper emphasizes the link between the nature of the political structure/policymaking environment and the government’s reform capacity. Thailand’s political structure typically undercuts the government’s reform capacity in two way. First, it is difficult to get needed reforms on the political agenda. Second, it is even harder to push reforms through the policy process to implementation. During the 1980s, Thailand was able to overcome some of the challenges inherent in its political system via an informal compromise between party politicians and technocratic reformers. This ‘pork-policy compromise’ gave the government the capacity to adopt certain reforms—reforms that laid the foundation for the economic boom of the late 1980s and early 1990s. Changes in the political structure in the late 1980s brought an end to this compromise, thereby reducing the government’s reform capacity.http://deepblue.lib.umich.edu/bitstream/2027.42/40024/3/wp638.pd

Local Government Action and Antitrust Policy: An Economic Analysis

At least partly as a result of the Supreme Court decision in Community Communications Co. v. City of Boulder, cities are facing antitrust challenges to their rights to franchise cable television systems. Other municipal activities have been similarly challenged. The prospect of costly and uncertain antitrust litigation challenging local government actions will restrict the scope and extent of local regulatory activity. Such restrictions could, in turn, preempt city residents\u27 ability to choose, through their elected representatives, the goods and services they prefer. This Article proposes that as a mater of policy the burden of proving a municipal antitrust violation should be on those who seek to restrict municipal action. This Article discusses the merits behind the general case for municipal antitrust immunity and the specific circumstances in which cities might face liability under antitrust laws. Further, this Article sets out three criteria by which the potential for adverse effects of a city\u27s action may be determined, then assesses the leading state action cases using these criteria. Finally, this Article concludes by describing the appropriate policies for dealing with potentially inefficient city actions and makes specific recommendations consistent with the current case law

Checks and balances: an assessment of the institutional separation of political powers in Colombia

In this paper, we evaluate the institutional and legal structure of the Colombian government. In particular, we want to assess how a system of institutional checks and balances can be structured to promote the rule of law, preserve property rights, and stimulate economic growth. The 1991 Constitution indeed makes commendable commitments to these objectives. Yet, due to its institutional structure, Colombia is governed in a manner that is both unchecked and unbalanced. The Colombian Constitution is an enormously long document that attempts to reassure all parties that the future will be to their liking. For example, Article 58, which permits uncompensated expropriation for reasons of “equity”, might be a substantial deterrent to investment. The nation’s long run economic health may be seriously impaired if peace is bought at the price of widespread concessions with regard to either the process of decision-making about the economy or to the specific content of future government economic policies. One may buy transitory tranquility, which may not translate in to lasting peace, at the price of long-term instability and turmoil. We make recommendations for institutional reform, which aim to mitigate clientelist and populist trends in Colombian politics. To enhance policymaking by reducing the scope for gridlock, we propose measures such as long-term appointments and ballot accountability that eliminate distortions to the voting incentives of both judges and lawmakers. Also, procedures are set forth to limit undue deliberations by the judiciary and to induce institutional status-quo bias. While we support constitutional provisions for the stability of a political process endowed with representativeness, we reject constitutional provisions that attempt to entrench one particular policy outcome. Stationary policy is likely to be both suboptimal and unsustainable in a stochastic and dynamic environment