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Is polarization bad?

  • Testa, Cecilia

The adverse effects of political and social polarization on government policies are empirically well documented, yet some democracies seem to cope well or even benefit from diversity. In this paper we develop a theoretical model to show how elections in polarized societies contribute to improve quality of government. We consider both polarization among citizens and political actors (political polarization), where the second is endogenously determined by parties competing to win the support of the majority of voters. We find that more heterogeneous societies are more likely to be politically polarized, but that the divergence of positions in the political arena helps the electorate control government corruption by raising electoral stakes. Our results, which are consistent with the findings of a substantial empirical literature, suggest that, when funneled into political competition, polarization may help improving quality of government and policies.

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Article provided by Elsevier in its journal European Economic Review.

Volume (Year): 56 (2012)
Issue (Month): 6 ()
Pages: 1104-1118

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Handle: RePEc:eee:eecrev:v:56:y:2012:i:6:p:1104-1118
Contact details of provider: Web page: http://www.elsevier.com/locate/eer

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  1. Banks, Jeffrey S. & Sundaram, Rangarajan K., 1998. "Optimal Retention in Agency Problems," Journal of Economic Theory, Elsevier, vol. 82(2), pages 293-323, October.
  2. Alesina, Alberto & Spear, Stephen, 1988. "An Overlapping Generations Model of Electoral Competition," Scholarly Articles 4553015, Harvard University Department of Economics.
  3. T. Groseclose, 2007. "‘One and a Half Dimensional’ Preferences and Majority Rule," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 28(2), pages 321-335, February.
  4. Timothy Besley & Maitreesh Ghatak, 2005. "Competition and Incentives with Motivated Agents," American Economic Review, American Economic Association, vol. 95(3), pages 616-636, June.
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  6. John Ferejohn, 1986. "Incumbent performance and electoral control," Public Choice, Springer, vol. 50(1), pages 5-25, January.
  7. Valentino Larcinese & James M. Snyder & Cecilia Testa, 2009. "Testing Models of Distributive Politics using Exit Polls to Measure Voters Preferences and Partisanship," Development Working Papers 278, Centro Studi Luca d'Agliano, University of Milano.
  8. Budge, Ian, 1994. "A New Spatial Theory of Party Competition: Uncertainty, Ideology and Policy Equilibria Viewed Comparatively and Temporally," British Journal of Political Science, Cambridge University Press, vol. 24(04), pages 443-467, October.
  9. David S. Lee & Enrico Moretti & Matthew J. Butler, 2004. "Do Voters Affect or Elect Policies? Evidence from the U. S. House," The Quarterly Journal of Economics, Oxford University Press, vol. 119(3), pages 807-859.
  10. José G. Montalvo & Marta Reynal-Querol, 2005. "Ethnic Polarization, Potential Conflict, and Civil Wars," American Economic Review, American Economic Association, vol. 95(3), pages 796-816, June.
  11. Campos, Nauro F & Kuzeyev, Vitaliy, 2007. "On the Dynamics of Ethnic Fractionalization," CEPR Discussion Papers 6360, C.E.P.R. Discussion Papers.
  12. Elisabeth R. Gerber & Jeffrey B. Lewis, 2004. "Beyond the Median: Voter Preferences, District Heterogeneity, and Political Representation," Journal of Political Economy, University of Chicago Press, vol. 112(6), pages 1364-1383, December.
  13. Roger B. Myerson, 2006. "Bipolar Multicandidate Elections with Corruption," Scandinavian Journal of Economics, Wiley Blackwell, vol. 108(4), pages 727-742, December.
  14. Harrington, Joseph Jr., 1992. "The role of party reputation in the formation of policy," Journal of Public Economics, Elsevier, vol. 49(1), pages 107-121, October.
  15. Testa, Cecilia, 2010. "Bicameralism and corruption," European Economic Review, Elsevier, vol. 54(2), pages 181-198, February.
  16. Gene M. Grossman & Elhanan Helpman, 1996. "Electoral Competition and Special Interest Politics," Review of Economic Studies, Oxford University Press, vol. 63(2), pages 265-286.
  17. Valentino Larcinese & James M. Snyder, Jr. & Cecilia Testa, 2006. "Testing Models Of Distributive Politicsusing Exit Polls To Measure Voterpreferences And Partisanship," STICERD - Political Economy and Public Policy Paper Series 19, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
  18. Poole, Keith T. & Rosenthal, Howard, 1996. "Are legislators ideologues or the agents of constituents?," European Economic Review, Elsevier, vol. 40(3-5), pages 707-717, April.
  19. José Garcia Montalvo & Marta Reynal-Querol, 2004. "Ethnic polarization, potential conflict and civil wars," Economics Working Papers 770, Department of Economics and Business, Universitat Pompeu Fabra, revised Mar 2005.
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