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Information, polarization and term length in democracy


  • Schultz, Christian


This paper considers term lengths in a representative democracy where the political issue divides the population on the left-right scale. Parties are ideologically different and better informed about the consequences of policies than voters are. A short term length makes the government more accountable, but the re-election incentive leads to policy distortion as the government seeks to manipulate swing voters' beliefs to make its ideology more popular. This creates a trade off: A short term length improves accountability but gives distortions. A short term length is best for swing voters when the uncertainty is large and parties are not very polarized. Partisan voters always prefer a long term length. When politicians learn while in office a long term length becomes more attractive for swing voters.

Suggested Citation

  • Schultz, Christian, 2008. "Information, polarization and term length in democracy," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1078-1091, June.
  • Handle: RePEc:eee:pubeco:v:92:y:2008:i:5-6:p:1078-1091

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    References listed on IDEAS

    1. Christian Schultz, 1996. "Polarization and Inefficient Policies," Review of Economic Studies, Oxford University Press, vol. 63(2), pages 331-344.
    2. Alberto Alesina & Guido Tabellini, 2007. "Bureaucrats or Politicians? Part I: A Single Policy Task," American Economic Review, American Economic Association, vol. 97(1), pages 169-179, March.
    3. repec:cup:apsrev:v:90:y:1996:i:01:p:34-45_20 is not listed on IDEAS
    4. Smart, Michael & Sturm, Daniel M., 2013. "Term limits and electoral accountability," Journal of Public Economics, Elsevier, vol. 107(C), pages 93-102.
    5. Anthony Downs, 1957. "An Economic Theory of Political Action in a Democracy," Journal of Political Economy, University of Chicago Press, vol. 65, pages 135-135.
    6. Schultz, Christian, 2002. "Policy biases with voters' uncertainty about the economy and the government," European Economic Review, Elsevier, vol. 46(3), pages 487-506, March.
    7. Eric Maskin & Jean Tirole, 2004. "The Politician and the Judge: Accountability in Government," American Economic Review, American Economic Association, vol. 94(4), pages 1034-1054, September.
    8. F. Andrew Hanssen, 2004. "Is There a Politically Optimal Level of Judicial Independence?," American Economic Review, American Economic Association, vol. 94(3), pages 712-729, June.
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    Cited by:

    1. Castanheira, Micael & Nicodème, Gaëtan & Profeta, Paola, 2011. "On the political economics of tax reforms," CEPR Discussion Papers 8507, C.E.P.R. Discussion Papers.
    2. Massimo Bordignon, 2015. "Exit and Voice: Yardstick Versus Fiscal Competition Across Governments," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 1(1), pages 117-137, March.
    3. Panu Poutvaara & Tuomas Takalo & Andreas Wagener, 2017. "The Optimal Duration of Contracts," CESifo Working Paper Series 6808, CESifo Group Munich.
    4. Micael Castanheira & Gaëtan Nicodème & Paola Profeta, 2012. "On the political economics of tax reforms: survey and empirical assessment," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 19(4), pages 598-624, August.
    5. Mickael Melki & Andrew Pickering, 2016. "Polarization and Corruption in America," Discussion Papers 16/09, Department of Economics, University of York.
    6. Iconio Garrì, 2008. "Politician's Reputation and Policy (Un)persistence," DISCE - Quaderni dell'Istituto di Teoria Economica e Metodi Quantitativi itemq0851, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    7. Georgy Egorov & Konstantin Sonin, 2013. "A Political Theory of Populism," The Quarterly Journal of Economics, Oxford University Press, vol. 128(2), pages 771-805.
    8. Tilman Klumpp, 2011. "Populism, Partisanship, and the Funding of Political Campaigns," Emory Economics 1107, Department of Economics, Emory University (Atlanta).
    9. Ernesto Dal Bó & Martín Rossi, 2008. "Term Length and Political Performance," NBER Working Papers 14511, National Bureau of Economic Research, Inc.
    10. Binswanger, J. & Prüfer, J., 2009. "Imperfect Information, Democracy, and Populism," Discussion Paper 2009-10, Tilburg University, Center for Economic Research.

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