Businessman Candidates: Special-Interest Politics in Weakly Institutionalized Environments

We initiate examination of the political boundaries of the firm by exploring the phenomenon of “businessman candidates”: business owners and managers who bypass conventional means of political influence to run for public office themselves. We argue that in-house production of political influence will be more likely in institutional environments where candidates find it difficult to make binding campaign promises. When campaign promises are binding, then a businessman may always pay a professional politician to run on the platform that political competition would otherwise compel the businessman to adopt. In contrast, when commitment to a campaign platform is impossible, then candidate identity matters for the policies that will be adopted ex post, implying that a businessman may choose to run for office if the stakes are sufficiently large. We illustrate our arguments through discussion of gubernatorial elections in postcommunist Russia, where businessmen frequently run for public office, institutions to encourage elected officials to keep their campaign promises are weak, and competition for rents is intense.http://deepblue.lib.umich.edu/bitstream/2027.42/40119/3/wp733.pd

Aggregate uncertainty, framing effects, and candidate entry

This dissertation studies how different voter characteristics and electoral rules affect the incentives and decisions to seek political office. The focus is on generalizing standard approaches to observed differences in the runoff rule and incorporating more accurate descriptions of voter behavior which may not be fully rational. In each chapter, I consider a model of strategic entry by candidates for office in democratic elections. In the first chapter, I incorporate the observed differences in thresholds for first-round victory in a model of runoff elections. The set of equilibria varies substantially with the threshold, indicating that the 50 percent threshold used in most models is not innocuous. The set of equilibria immediately contains equilibria that were thought to exist only under plurality rule, whereas for thresholds above 50 percent, there is no change in the set of equilibria. Additionally, for any threshold under one half, there exist equilibria in which a candidate who loses with certainty still chooses to run. The set of two candidate equilibria is invariant to all thresholds under one third, and the set of multicandidate equilibria is invariant to all thresholds above one half. In the second chapter, I introduce aggregate uncertainty by making candidates unsure of the distribution of voter preferences in the electorate. The set of three candidate equilibria expands and equilibrium platforms become more diverse. This provides a theoretical basis for Duverger’s Hypothesis. Equilibria also feature two common empirical phenomena. For instance, some candidates choose to enter despite losing with certainty in equilibrium. Also, in some equilibria, a Condorcet winning candidate (a candidate who would win every pairwise election) fails to win the election. In the third chapter, I generalize the citizen-candidate model to a multidimensional setting and characterize the set of equilibria. I later incorporate two well-documented violations of the Weak Axiom of Revealed Preference in a model of plurality elections: the compromise and attraction effects. Entry by an extreme candidate may shift the frame of reference for some voters in ways which favor particular moderate candidates. Incorporating these preferences generate equilibria in which extremist candidates enter plurality elections in order to attractively frame their preferred moderate, even if the extremist has probability zero of obtaining office themselves

Protest voting in the laboratory

Formal analysis predicts that the likelihood of an electoral accident depends on the preference intensity for a successful protest, but not on the protest's popularity: an increase in protest's popularity is fully offset by a reduction in the individual probability of casting a protest vote. By conducting the first laboratory experiment on protest voting, we find strong evidence in favor of the first prediction and qualified support for the latter. While the offset effect is present, it is not as strong as the theory predicts: protest candidates gain both by fanaticising existing protesters and by expanding the protest's popular base

Incomplete information, proportional representation and strategic voting

We introduce incomplete information to a multiparty election under proportional representation: each voter knows her preferences and votes strategically to maximize her payoffs, but is uncertain about the number and the preferences of the other voters. Parties are assumed to be purely office motivated and, hence, the resulting governments are always minimum winning. In this framework we prove a) generic existence of equilibria where only two parties receive a positive fraction of the votes and therefore lead to single-party governments and b) generic inexistence of equilibria that lead to coalition governments. That is, contrary to common wisdom, a proportional rule is found not to promote sincere voting and to be favorable towards single-party governments. The existence of two-party equilibria that lead to single-party governments is robust to parties having ideological concerns

Models of Political Economy

Models of Political Economy will introduce students to the basic methodology of political economics. It covers all core theories as well as new developments including: decision theory game theory mechanism design games of asymmetric information. Hannu Nurmi's text will prove to be invaluable to all students who wish to understand this increasingly technical field