Institutional flexibility, political alternation and middle-of-the-road policies

Empirical observation shows that policies are usually gradually introduced in a society. This paper presents a model of repeated elections that captures this phenomenon, and that allows countries to differ in their institutional flexibility, thus in the speed of implementation of new policies. We show that with gradual implementation of policies there is an incentive for the voters to vote, each election, to a different party. Hence, our model produces equilibria with alternation. We further show that there is a tradeoff between efficiency and stability, with efficiency requiring moderate policies and stability pushing towards polarization. Last, we show that except for the partisan equilibria, the most stable ones convey policies that are bounded away from both the median and the extremes, with policies polarizing more when institutions are either too flexible or sufficiently rigid.