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Electoral competition and political rents

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  • Michele Polo

Abstract

We analyze the relation between the intensity of electoral competition and the dissipation of political rents. In a model with perfectly informed and heterogeneous voters, two candidates commit to electoral platforms under a majority voting and winner-takes-all rule. If the proposed tax revenues exceed the cost of the public good, the winning candidate retains the surplus (political rents). The candidates are uncertain about voters' preferences. If they do not know them ean of voters' distribution (aggregate uncertainty), competition is relaxed and rents are positive. We then consider some extensions, as ideological positioning, increasing the number of candidates and imperfect commitment to the annouced policies.Series: IGIER Working Paper Series

Suggested Citation

  • Michele Polo, "undated". "Electoral competition and political rents," Working Papers 144, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  • Handle: RePEc:igi:igierp:144
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    1. Sobre conflicto horizontal y vertical
      by Gustavo Torrens in Foco Económico on 2016-06-23 02:00:52

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    Cited by:

    1. Besley, Timothy J. & Persson, Torsten & Sturm, Daniel M, 2005. "Political Competition and Economic Performance: Theory and Evidence from the United States," CEPR Discussion Papers 5138, C.E.P.R. Discussion Papers.
    2. Canegrati, Emanuele, 2007. "A Contribution to the Positive Theory of Indirect Taxation," MPRA Paper 6116, University Library of Munich, Germany.
    3. Canegrati, Emanuele, 2006. "Political Bad Reputation," MPRA Paper 1018, University Library of Munich, Germany.
    4. Fabio Padovano & Roberto Ricciuti, 2008. "The Political Competition-Economic Performance Puzzle: Evidence from the OECD Countries and the Italian Regions," CESifo Working Paper Series 2411, CESifo.
    5. Timothy Besley & Torsten Persson & Daniel M. Sturm, 2010. "Political Competition, Policy and Growth: Theory and Evidence from the United States," CEP Discussion Papers dp1009, Centre for Economic Performance, LSE.
    6. Yogesh Uppal & Amihai Glazer, 2015. "Legislative Turnover, Fiscal Policy, And Economic Growth: Evidence From U.S. State Legislatures," Economic Inquiry, Western Economic Association International, vol. 53(1), pages 91-107, January.
    7. Evrenk, Haldun, 2002. "Political economy of anti-corruption reform in two-candidate elections," MPRA Paper 1958, University Library of Munich, Germany, revised Jul 2006.
    8. Persson, Torsten & Tabellini, Guido, 1999. "The size and scope of government:: Comparative politics with rational politicians," European Economic Review, Elsevier, vol. 43(4-6), pages 699-735, April.
    9. Albert Solé-Ollé, 2006. "The effects of party competition on budget outcomes: Empirical evidence from local governments in Spain," Public Choice, Springer, vol. 126(1), pages 145-176, January.
    10. Evrenk, Haldun, 2008. "Mackerels in the Moonlight: A Duopoly Model of Political Agency," Working Papers 2008-4, Suffolk University, Department of Economics.
    11. Carrillo, Juan D & Castanheira, Micael, 2002. "Platform Divergence, Political Efficiency and the Median Voter Theorem," CEPR Discussion Papers 3180, C.E.P.R. Discussion Papers.
    12. Aidt, T.S. & Eterovic, D.S., 2007. "Give and Take: Political Competition, Participation and Public Finance in 20th Century Latin America," Cambridge Working Papers in Economics 0714, Faculty of Economics, University of Cambridge.
    13. Gersbach, Hans & Schneider, Maik T., 2012. "Tax contracts and elections," European Economic Review, Elsevier, vol. 56(7), pages 1461-1479.
    14. Evrenk, Haldun, 2008. "On the (In)Effectiveness of Some Commonly Proposed Anti-Corruption Reforms," Working Papers 2008-5, Suffolk University, Department of Economics.
    15. Canegrati, Emanuele, 2006. "Yardstick competition: a spatial voting model approach," MPRA Paper 1017, University Library of Munich, Germany.
    16. Albert Solé-Ollé, 2006. "The effects of party competition on budget outcomes: Empirical evidence from local governments in Spain," Public Choice, Springer, vol. 126(1), pages 145-176, January.
    17. Yogesh Uppal, 2011. "Does legislative turnover adversely affect state expenditure policy? Evidence from Indian state elections," Public Choice, Springer, vol. 147(1), pages 189-207, April.
    18. Arzaghi, Mohammad & Henderson, J. Vernon, 2005. "Why countries are fiscally decentralizing," Journal of Public Economics, Elsevier, vol. 89(7), pages 1157-1189, July.
    19. Haldun Evrenk, 2004. "Mackerels in the moonlight. A model of corrupt politicians," Econometric Society 2004 North American Summer Meetings 501, Econometric Society.
    20. Fabio Padovano & Roberto Ricciuti, 2009. "Political competition and economic performance: evidence from the Italian regions," Public Choice, Springer, vol. 138(3), pages 263-277, March.
    21. Haldun Evrenk, 2005. "Mackerels in the Moonlight: Corrupt Politicians and Anti- Corruption Reform in Two-Candidate Elections," Game Theory and Information 0507005, University Library of Munich, Germany.
    22. Mulligan, Casey B. & Tsui, Kevin K., 2015. "Political entry, public policies, and the economy," Research in Economics, Elsevier, vol. 69(3), pages 377-397.
    23. Ashworth, Scott & Bueno de Mesquita, Ethan, 2009. "Elections with platform and valence competition," Games and Economic Behavior, Elsevier, vol. 67(1), pages 191-216, September.
    24. Maria Paola & Vincenzo Scoppa, 2011. "Political competition and politician quality: evidence from Italian municipalities," Public Choice, Springer, vol. 148(3), pages 547-559, September.

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