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Electoral competition and endogenous political institutions: Quasi-experimental evidence from Germany

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  • Baskaran, Thushyanthan
  • Lopes da Fonseca, Mariana

Abstract

Do established parties change political institutions to disadvantage new political actors if the latters’ electoral prospects improve? We study this question with a natural experiment from the German federal state of Hesse. The experiment is an electoral reform for local elections that improved the electoral prospects of smaller parties and party rebels. However, local politicians from the large mainstream parties could adjust municipal political institutions in such a way as to counteract this effect of the reform. One such institutional adjustment was to reduce the size of the local council because a reduction in council size raises the implicit electoral threshold and thus disadvantages especially smaller parties. Using a dataset that covers all 426 Hessian municipalities over the period 1989–2011, we document with a difference-in-discontinuities design that municipalities where the electoral competitiveness of smaller parties improved more after the reform saw a larger reduction in their council size. Hence, established parties appear to erect barriers to entry by adjusting political institutions once new political actors become viable electoral alternatives.

Suggested Citation

  • Baskaran, Thushyanthan & Lopes da Fonseca, Mariana, 2016. "Electoral competition and endogenous political institutions: Quasi-experimental evidence from Germany," Journal of Economic Behavior & Organization, Elsevier, vol. 122(C), pages 43-61.
  • Handle: RePEc:eee:jeborg:v:122:y:2016:i:c:p:43-61
    DOI: 10.1016/j.jebo.2015.11.012
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    Cited by:

    1. Thushyanthan Baskaran & Zohal Hessami, 2017. "Political alignment and intergovernmental transfers in parliamentary systems: evidence from Germany," Public Choice, Springer, vol. 171(1), pages 75-98, April.
    2. Ivo Bischoff & Eva Wolfschuetz, 2019. "Inter-municipal cooperation in administrative tasks– the role of population dynamics and elections," MAGKS Papers on Economics 201905, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    3. Andrew C. Eggers & Ronny Freier & Veronica Grembi & Tommaso Nannicini, 2018. "Regression Discontinuity Designs Based on Population Thresholds: Pitfalls and Solutions," American Journal of Political Science, John Wiley & Sons, vol. 62(1), pages 210-229, January.
    4. Thushyanthan Baskaran & Zohal Hessami, 2018. "Does the Election of a Female Leader Clear the Way for More Women in Politics?," American Economic Journal: Economic Policy, American Economic Association, vol. 10(3), pages 95-121, August.
    5. Thushyanthan Baskaran & Mariana Lopes da Fonseca, 2016. "Electoral thresholds and political representation," Public Choice, Springer, vol. 169(1), pages 117-136, October.
    6. Ivo Bischoff & Eva Wolfschuetz, 2017. "The Emergence of Inter-Municipal Cooperation – A Hazard Model Approach," MAGKS Papers on Economics 201744, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    7. Christian Bergholz & Ivo Bischoff, 2016. "Local council members’ view on inter-municipal cooperation: Does office-related self interest matter?," MAGKS Papers on Economics 201647, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).

    More about this item

    Keywords

    Electoral rules; Electoral thresholds; Open party lists; Political competition;

    JEL classification:

    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • 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

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