Curbing Power or Progress? Governing with an Opposition Veto
AbstractVeto institutions are often dominated by government opponents with rival electoral and policy interests (e.g. \divided government"). I investigate the tradeoff between policy control and policy blockade when both the government and the veto party may cater to opposing special interests. The value of an opposition veto depends on whether electoral accountability can discipline bad type politicians. When this is not the case, a veto is beneficial only if the government's special interests are expected to be harmful. In contrast, when bad types care about (re-)election, a veto always increases expected welfare, providing a new rationale for the frequent occurrence of "divided government". Without policy rivalry, an opposition veto fares even better.
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Bibliographic InfoPaper provided by University of Bonn, Germany in its series Bonn Econ Discussion Papers with number bgse10_2004.
Date of creation: Jun 2004
Date of revision:
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Political Accountability; Opposition; Veto; Divided Government;
Find related papers by JEL classification:
- A12 - General Economics and Teaching - - General Economics - - - Relation of Economics to Other Disciplines
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy Formulation and Implementation
- H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
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