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Secondary Issues and Party Politics: An Application to Environmental Policy

  • Anesi, Vincent
  • De Donder, Philippe

The paper develops a political economy model to assess the interplay between political party formation and an environmental policy dimension viewed as secondary to the redistributive dimension. We define being a secondary issue in terms of the intensity of preferences over this issue rather than in terms of the proportion of voters who care for the environment. We build on Levy (2004) for the political equilibrium concept, defined as the solution to a two stage game where politicians first form parties and where parties then compete by choosing a policy bundle in order to win the elections. We obtain the following results: i) The Pigouvian tax never emerges in an equilibrium; ii) The equilibrium environmental tax is larger when there is a minority of green voters; iii) Stable green parties exist only if there is a minority of green voters and income polarization is large enough relative to the saliency of the environmental issue. We also study the redistributive policies advocated by green parties.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6774.

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Date of creation: Apr 2008
Date of revision:
Handle: RePEc:cpr:ceprdp:6774
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  1. Esteban, J. & Ray, D., 1993. "On the Measurement of Polarization," UFAE and IAE Working Papers 221.93, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
  2. Vincent Anesi & Philippe De Donder, 2009. "Party Formation and Minority Ideological Positions," Economic Journal, Royal Economic Society, vol. 119(540), pages 1303-1323, October.
  3. Gilat Levy, 2004. "A model of political parties," LSE Research Online Documents on Economics 540, London School of Economics and Political Science, LSE Library.
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  9. Fredriksson, Per G., 1997. "The Political Economy of Pollution Taxes in a Small Open Economy," Journal of Environmental Economics and Management, Elsevier, vol. 33(1), pages 44-58, May.
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  13. Congleton, Roger D, 1992. "Political Institutions and Pollution Control," The Review of Economics and Statistics, MIT Press, vol. 74(3), pages 412-21, August.
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  15. Effrosyni Diamantoudi & Licun Xue, . "Coalitions, Agreements and Efficiency," Economics Working Papers 2002-9, School of Economics and Management, University of Aarhus.
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  17. Anesi, Vincent & De Donder, Philippe, 2007. "Party Formation and Racism," IDEI Working Papers 450, Institut d'Économie Industrielle (IDEI), Toulouse.
  18. repec:oup:qjecon:v:101:y:1986:i:1:p:1-31 is not listed on IDEAS
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  20. Neumayer, Eric, 2004. "The environment, left-wing political orientation and ecological economics," Ecological Economics, Elsevier, vol. 51(3-4), pages 167-175, December.
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  30. Helmuth Cremer & Philippe De Donder & Firouz Gahvari, 2004. "Taxes, Budgetary Rule and Majority Voting," Public Choice, Springer, vol. 119(3_4), pages 335-358, 06.
  31. repec:oup:qjecon:v:112:y:1997:i:1:p:85-114 is not listed on IDEAS
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