Governing the System
Persistence in Policy: Evidence from Close Votes
Zach Freitas-Groff
Stanford Working Paper, November 2023
Abstract:
Policy choices sometimes appear stubbornly persistent, even when they become politically unpopular or economically damaging. This paper offers the first systematic empirical investigation of how persistent policy choices are, defined as whether an electorate’s or legislature’s decisions affect whether a policy is in place decades later. I create a new dataset that tracks the historical record of more than 800 policies that were the subjects of close U.S. state referendums since 1900. In a regression discontinuity design, I estimate that passing a referendum increases the chance a corresponding policy is operative 20, 40, or even 100 years later by over 40 percentage points. I collect additional data on U.S. Congressional legislation and international referendums and use existing data on state legislation to document similar policy persistence for a range of institutional environments, cultures, and topics. I develop a theoretical model to distinguish between possible causes of persistence, and I present evidence that persistence arises because policies' salience systematically declines over time. Calibrating my model suggests that many policies remain in place -- or not -- regardless of popular support.
Kosher Pork
Allan Drazen & Ethan Ilzetzki
Journal of Public Economics, November 2023
Abstract:
There are two common views of pork barrel spending. One is that pork barrel spending benefits special interests at the expense of social welfare, hence antithetical to responsible policy making, especially in times of crisis. An alternative is that pork “greases the legislative wheels” making possible the enactment of socially beneficial legislation that would otherwise not pass. In this paper we reexamine both arguments and show that they depend on the nature of heterogeneity of interests and information across legislators. Under full information, but with heterogeneous ideology, policy compromise may be sufficient to pass beneficial legislation. Pork typically reduces welfare as in the conventional wisdom, but we also characterize cases where pork can indeed “grease the wheels” and improve social welfare. When agents are heterogeneous not only in their ideology, but also their information, allocation of pork may be crucial to passage of legislation appropriate to the situation. It does so not simply by inducing legislators to accept legislation they view as harmful, but also by conveying information about the necessity of policy change, where it may be impossible to convey such information in the absence of pork. Moreover, pork will be observed when the public good is most valuable precisely because it is valuable and the informed agenda setter wants to convey this information. Moreover, information may be conveyed for the reason pork is widely criticized, that is, because it benefits special interests.
The Importance of Breaking Even: How Local and Aggregate Returns Make Politically Feasible Policies
Alan Gerber et al.
British Journal of Political Science, forthcoming
Abstract:
Policies that promote the common good may be politically infeasible if legislators representing ‘losing’ constituencies are punished for failing to promote their district's welfare. We investigate how varying the local and aggregate returns to a policy affects voter support for their incumbent. In our first study, we find that an incumbent who favours a welfare-enhancing policy enjoys a discontinuous jump in support when their district moves from losing to at least breaking even, while the additional incremental political returns for the district doing better than breaking even are modest. This feature of voter response, which we replicate, has significant implications for legislative politics generally and, in particular, how to construct politically feasible social welfare-enhancing policies. In a second study, we investigate the robustness of this finding in a competitive environment in which a challenger can call attention to a legislator's absolute and relative performance in delivering resources to their district.
Estimating the value of democracy relative to other institutional and economic outcomes among citizens in Brazil, France, and the United States
Alicia Adserà, Andreu Arenas & Carles Boix
Proceedings of the National Academy of Sciences, 28 November 2023
Abstract:
How much do citizens value democracy? How willing are they to sacrifice their liberties and voting rights for growth, equality, or other social outcomes? We design a conjoint experiment in nationally representative surveys in Brazil, France, and the United States in which respondents choose between different societies that randomly vary in their economic outcomes (country income, income inequality, social mobility), political outcomes (democracy, public health insurance), and the level of personal income for each respondent. Our research allows us to estimate the respondents’ willingness to trade off democracy for individual income (as well as other societal attributes). We find that, on average, individuals are strongly attached to democracy and a robust welfare state. They prefer to live in a country without free democratic elections only if their individual income multiplies by at least three times and in a country without public health insurance only if their individual income more than doubles. After estimating these preferences at the individual level for all respondents, we show that, although there is an authoritarian minority in all three countries, forming a nondemocratic majority (by offering more income and/or other goods to respondents) is very unlikely. Our findings imply that, contrary to a growing discussion about the crisis of democracy, liberal democratic values remain substantially robust in high and middle income democracies.
Policymaker Responses to CEO Activism
Christopher Poliquin & Young Hou
University of Virginia Working Paper, October 2023
Abstract:
CEOs increasingly engage in activism on controversial social and political issues, such as police reform, LGBTQ rights, and gun control, to influence the behavior of policymakers. We run an experiment on 514 elected, local politicians to examine how CEO activism on police reform affects the views of policymakers. Additionally, we examine how CEOs’ controversial positions on social issues affects politicians’ willingness to privately meet with CEOs or publicly advocate for their businesses. We find that CEO support for specific police reform policies has no effect on policymakers’ opinions. Policymakers, however, are much less willing to engage -- either privately or publicly -- with CEOs who take controversial positions on social issues. Our results suggest that CEO activism is a poor tool for influencing local politicians, at least on the topic of police reform, and underscore the business costs of CEOs taking political positions. We discuss the implications for CEOs and the activist groups that often pressure them to take public positions on controversial issues.
Road maintenance over the local election cycle
Margaret Bock & Benjamin Blemings
Public Choice, forthcoming
Abstract:
Despite recognition that government officials have politically motivated incentives to pursue new infrastructure construction at the expense of infrastructure upkeep, no prior research directly addresses how political incentives affect road maintenance separate from road construction. This paper investigates how local political incentives affect local road maintenance using unique data on completed road maintenance projects and difference-in-differences which leverages exogenous timing of mayoral elections. Since residents complain about damaged roads and can also be frustrated by travel delays caused by road maintenance, it is theoretically ambiguous how elected officials manipulate road maintenance, assuming they do so for political purposes. We show local election cycles shift road maintenance timing and location. We provide evidence that maintenance follows different patterns in mayoral election years and that maintenance is shifted around sub-city geographic units based on those units’ political similarity of registered voters. A mayoral election costs $90,623 in additional road-related costs, translating to $28,093,182 per election for large cities.
Strategic Subdelegation
Brian Feinstein & Jennifer Nou
Journal of Empirical Legal Studies, December 2023, Pages 746-817
Abstract:
Appointed leaders of administrative agencies routinely record subdelegations of governmental authority to civil servants. That appointees willingly cede authority in this way presents a puzzle, at least at first glance: Why do such appointees assign their power to civil servants insulated by merit protection laws, that is, to employees over whom they have limited control? This Article develops and tests a theory to explain this behavior. Using original data on appointee-to-civil servant delegations and a measure of the ideological distance between these two groups of actors, we show that appointees are more willing to vest power in civil servants when the two groups are more closely aligned. They are particularly likely to do so in the last months of a presidential administration, prior to a transition to a new set of appointees from a different party. Essentially, appointees strategically devolve authority to ideologically similar civil servants to entrench their views in the face of oppositional future presidential administrations. Further, judicial doctrine and interest-group politics can make existing subdelegations difficult to reverse. This stickiness adds to the strategic value of subdelegations as a means of projecting preferences into future administrations. These findings raise important implications for administrative law and governance. One conventional wisdom on intra-agency dynamics considers appointees and civil servants as rivals. Relatedly, studies of personnel practices focus on strategies to empower appointees and sideline civil servants. This Article, by contrast, shows how appointees and civil servants can act as strategic partners under certain conditions. At a time when leading political figures propose fundamental changes to the civil service, our findings call for a more nuanced understanding of the dynamics between political appointees and civil servants.
Incentivizing free riders improves collective intelligence in social dilemmas
Ofer Tchernichovski et al.
Proceedings of the National Academy of Sciences, 14 November 2023
Abstract:
Collective intelligence challenges are often entangled with collective action problems. For example, voting, rating, and social innovation are collective intelligence tasks that require costly individual contributions. As a result, members of a group often free ride on the information contributed by intrinsically motivated people. Are intrinsically motivated agents the best participants in collective decisions? We embedded a collective intelligence task in a large-scale, virtual world public good game and found that participants who joined the information system but were reluctant to contribute to the public good (free riders) provided more accurate evaluations, whereas participants who rated frequently underperformed. Testing the underlying mechanism revealed that a negative rating bias in free riders is associated with higher accuracy. Importantly, incentivizing evaluations amplifies the relative influence of participants who tend to free ride without altering the (higher) quality of their evaluations, thereby improving collective intelligence. These results suggest that many of the currently available information systems, which strongly select for intrinsically motivated participants, underperform and that collective intelligence can benefit from incentivizing free riding members to engage. More generally, enhancing the diversity of contributor motivations can improve collective intelligence in settings that are entangled with collective action problems.
The Effects of the Great Compromise on the Constitutional Convention of 1787
Keith Dougherty & Aaron Hitefield
American Politics Research, forthcoming
Abstract:
The success of any constitutional convention can depend on its provisions for power sharing. We test three claims about the effects of the Great Compromise, a power sharing agreement, on the Constitutional Convention of 1787. First, we find that the convention was not more likely to pass proposals to strengthen the national government after the compromise than before, contrary to claims made by historians. Two small states increased their support, but other states did not. Second, Southern states (and large states) were more likely to support weakening the national government after the compromise. Third, large states were more likely to support proposals to strengthen the power of the House relative to the Senate after the compromise, and small states were more likely to resist. However, the opposite was not true for strengthening the Senate. Our results suggest a new narrative about the effects of Great Compromise on the Constitutional Convention.
Much Ado About Nothing? Overreaction to Random Regulatory Audits
Samuel Antill & Joseph Kalmenovitz
Harvard Working Paper, August 2023
Abstract:
Regulators often audit firms to detect non-compliance. Exploiting a natural experiment in the lobbying industry, we show that firms overreact to audits and this response distorts prices and reduces welfare. Each year, federal regulators audit a random sample of firm-client pairs. Following an audit, we find that audited clients are more likely to retain the audited lobbying firm, and they pay a lower price for the same amount of services. Estimating a dynamic structural model with our natural experiment, we show that this pattern is driven by overreaction: clients are almost indifferent to audits, but lobbying firms mistakenly believe their clients view audits as extremely negative events. Therefore, lobbyists offer unnecessary price discounts to retain audited clients. In a counterfactual world with no overreaction, we estimate that price corrections and better client-firm matching quality would increase welfare by 6.4%. Our results are the first to document an unintended effect of regulation on prices and matching, as regulated entities overreact to regulatory actions.