proportionality and turnout evidence from french municipalities many studies find that voter turnout is higher in proportional representation pr elections than in plurality elections but because the two systems differ in multiple ways and are used in differe

the nonvoting voter in voting research postelection surveys consistently overestimate voter turnout by a substantial margin this paper compares via discriminant analysis of data from the 1978 national election study the characteristics of respondents who falsely claim to have voted with the characteristics of actual voters and admitted nonvoters more importantly it undertakes two parallel analyses of the factors affecting voting or nonvoting the first employs respondent supplied voting data and the second employs officially validated voting data even though misreporters differ in some respects from actual voters and admitted nonvoters the parallel analyses in the latter part of the paper indicate that substantive conclusions about the factors that influence voting or nonvoting are largely unaffected by the use of validated as opposed to reported voting data

uncertainty and incentives empirical work testing for a trade off between risk and incentives has had at best mixed success this article provides two simple reasons associated with subjectivity of performance appraisals why we might not expect to see any negative relationship both reasons relate to empirically observed problems associated with monitoring i supervisors sometimes bias their evaluations based on their personal feelings toward their subordinates and ii supervisors will sometimes offer evaluations that reduce their costs these aspects of monitoring are ignored in the standard model and can reverse the usual negative trade off between risk and incentives

the downsian voter meets the ecological fallacy this paper presents evidence that voter participation does not depend on the probability that one vote is decisive an extensive summary of the empirical participation literature is provided which shows that most but not all studies have found that turnout in an electoral district is higher when the race is closer individual level vote regressions for the 1979 and 1980 canadian national elections are estimated using objective measures of closeness as opposed to self reported measures the main finding is that a citizen is no more likely to vote in a close election than in a lands lide election district level turnout regressions for the same elections are also estimated and a significant relation between closeness and turnout is observed this suggests that aggregation bias may generate a spurious closeness turnout relation in district level regressions

incentives in organizations n 1975 steven kerr published on the folly of rewarding a while hoping for b the argument was simple you get what you pay for kerr distilled this unifying theme from a disparate set of examples involving politicians soldiers doctors orphanage directors professors and students as well as manufacturing and clerical employees and even human resource managers from these examples kerr pp 77980 concluded that two main causes of distorted incentives are fascination with an objective criterion where individuals seek to establish simple quantifiable standards against which to measure and reward performance and overemphasis on highly visible behaviors when some parts of the task are highly visible while others are not it took agency theory 15 years to express kerr s title not to mention to evaluate or extend his conclusions during this period agency theory was obsessed with the tradeoff between incentives and insurance even though clear eyed observations like kerr s about the design and performance of real incentive contracts suggested that several other issues are at least as important fortunately recent work has brought agency theory not only to kerr s position but beyond in this paper i summarize four new strands in agency theory that help me think about incentives in real organizations as a point of departure i begin with a quick sketch of the classic agency model i then discuss static models of objective performance measurement that sharpen kerr s argument repeated game models of subjective performance assessments incentives for skill development rather than simply for effort and incentive contracts between versus within organizations i con

on transparency in organizations when is it best for the principal to commit to not disclosing all that he she knows in moral hazard interactions i show that whenever the agent would choose the same action under complete information at several distinct states then full transparency can generically be improved upon this implies that full transparency is generically suboptimal whenever the dimension of the information held by the principal exceeds the dimension of the agent s action in a simple class of problems i make further progress on the best disclosure policy assuming the principal can either disclose fully the state or remain silent

employment horizon and the choice of performance measures empirical evidence from annual bonus plans of loss making entities we examine the extent to which employment horizon concerns affect the relative emphasis on financial versus nonfinancial performance measures in annual bonus plans we argue that managers of loss making firms are likely to voluntarily or forcibly depart in the near future and consequently have a shorter employment horizon loss making firms then need to increase the emphasis on forward looking nonfinancial performance measures to motivate long term effort of their managers thus we hypothesize that the emphasis on nonfinancial performance measures is greater in loss making than in profitable firms even after controlling for the informativeness of earnings we find consistent support for our hypothesis using different archival survey and field data sources and various proxies for short employment horizon and the emphasis on nonfinancial performance measures

closeness expenditures and turnout in the 1982 u s house elections students of elections have repeatedly found that the closeness of an election is modestly correlated with turnout this may be due to a direct response of instrumentally motivated voters but recent theoretical work casts doubt on the adequacy of this explanation another possibility is that elite actors respond to closeness with greater effort at mobilization we explore the latter possibility by using fec and state data on campaign expenditures in house senate and gubernatorial races our results indicate that closeness has an effect at both the mass and elite levels we also provide quantitative estimates of the effect of senate and gubernatorial expenditure on house turnout

the commercialization of the microfinance industry is there a personal mission drift among credit officers recent research suggests that many microfinance institutions increasingly focus on financial performance at the expense of the social component of their dual objectives existing studies typically assume that capital providers and managers mainly drive this so called mission drift in this study we investigate whether personal mission drift at the credit officer level can further explain the reduced emphasis on poorer clients among microfinance institutions we present both qualitative and quantitative evidence that more experienced credit officers tend to serve fewer vulnerable clients specifically we show that all else being equal credit officer experience is negatively correlated with the provision of small loans loans to young clients and loans to clients with disabilities our qualitative analysis suggests that perceived client risk and preferences for increased time efficiency mainly drive more experienced credit officers relative neglect of more vulnerable clients this drift appears to be reinforced by the industry s incentive schemes therefore credit officer incentives and training should be designed to prevent this mission drift which is observed at the microfinance institution level but is actually initiated at the credit officer level

the downsian model of electoral participation formal theory and empirical analysis of the constituency size effect this paper applies a game theoretic model of participation under uncertainty to investigate the negative relationship between constituency size and voter turnout rates theconstituency size effect we find that this theoretical model accounts for almost all of the variation in turnout due to size in cross sectional data from school budget referenda

lost in the mail a field experiment on crime crime in the mail sector can hamper the development of elec tronic markets we use a field experiment to detect crime and measure its differential impacts we subtly and realistically manipulate the content and information available in mail sent to households and detect high levels of shirking and stealing eighteen percent of the mail never arrived at its des tination and even more was lost if there was even a slight hint of something additional inside the envelope our study demonstrates that privatization has been unable to extricate moral hazard and that crime is strategic and not equally distributed across the population

the economic model of voter participation a further test the central hypothesis of the economic model of voter participation was put to an empirical test it was found that the coefficient of population size which represents the subjective probability of affecting election results is negative and significant in municipal local elections but insignificant in national knesset elections therefore this variable is unable to represent subjective probability in the latter case

when is it foolish to reward for a while benefiting from b a performance measure may or may not reflect the relative importance of different tasks for the production of benefit it can be aligned or unaligned here i examine when using an aligned measure generates a larger surplus in a principal agent relationship than using an unaligned but otherwise identical measure i find that i the agent s effort costs matter for the optimal way of measuring performance and ii the optimal measure is not aligned but tilted toward tasks that the agent finds easy failing to recognize these insights may lead to false predictions about the use of incentives

perverse incentives labor market regulation and performance in the public sector we test the link between labor market regulations and job performance in the public sector using a novel outcome variable namely the number of days it takes the postal service to return letters sent to nonexistent foreign addresses a measure that we argue is an excellent proxy for job performance we find a positive and statistically significant link between these two variables regardless of the labor regulation measure employed changes in specification and even unlikely endogeneity considerations which suggest that this finding may be causal

rational turnout the neglected role of groups rational choice theories have difficulty accounting for individual participation in collective action voting is among the acts hardest to explain consumption benefits have been proposed to account for nonzero turnout the model presented here establishes a political investment basis for these benefits i argue that voters often act not in isolation but as part of groups with shared interests while individuals still vote because of consumption benefits arising from the act of voting some of these consumption benefits are provided by group leaders out of collective benefits received by the group in return for its votes the collective benefit comes from a candidate adopting policy positions closer to those of the group in passing i show that the widespread availability of public opinion polling increases the candidate s incentive to shift position finally some data from recent off year elections are shown to be consistent with the model

the rational behavior theory of voting participation evidence from the 1970 and 1982 elections in recent years a substantial literature on the determinants of voting participation has been developed in many of these studies voting is assumed to be an expression of rational behavior that is people vote when they expect that the benefits will exceed the related costs voting is largely an act of consumption based upon the widely held belief that one should vote to fulfill a civic duty or upon some combination of personal characteristics which is sufficiently vague to make precise measurement impossible the rational behavior theory however holds that voting is influenced at the margin by personal and environmental factors which incrementally affect expected benefits and costs making the act of voting more or less rational those factors which increase expected benefits will ceteris paribus enhance the probability that one will vote those factors which increase expected costs will of course have the opposite effect this study is presented as a primarily empirical contribution to the literature which assumes that since voting is an expression of rational behavior it can be modeled and tested using standard economic analysis and methodology

voter participation and strategic uncertainty the paradox of not voting is examined in a model where voters have uncertainty about the preferences and costs of other voters in game theoretic models of voter participation under complete information equilibrium outcomes can have substantial turnout even when voting costs are relatively high in contrast when uncertainty about preferences and costs is present only voters with negligible or negative net voting costs participate when the electorate is large

electoral institutions hometowns and favored minorities evidence from japanese electoral reforms this article presents evidence that electoral institutions affect the geographic distribution of both candidate electoral support and government resources the author exploits two electoral reforms in japan to identify the effect of institutional incentives 1 the 1994 electoral reform from a multimember single nontransferable vote sntv system to a mixed member majoritarian mmm system with a single member district smd component and a proportional representation component and 2 the 1925 electoral reform from a predominantly smd system to a multimember sntv system using several new data sets the two main findings of this article are that 1 japanese representatives competing in multimember sntv districts had more geographically concentrated electoral support than those competing in smds and that 2 intergovernmental transfers appear to be more concentrated around liberal democratic party ldp incumbents home offices under the multimember sntv system than under the mmm system the findings in this article highlight the connection between institutions and geographic patterns of representation

evidence on incentive effects of subjective performance evaluations the authors investigate the effect of managerial performance evaluation styles on employee work effort using panel data on 4 080 employees in a swiss unit of an international company for the period 1999 2002 they test two hypotheses using paid and unpaid overtime work as effort indicators the company applies two performance based remuneration mechanisms an individual surprise bonus and one in which salary is affected by the extent to which an individual has reached personalized targets the authors hypothesize that effort is higher in departments in which individual performance evaluations are more flexible over time as well as when surprise bonuses are used more frequently both hypotheses are supported and the estimated effects are substantial increases in rating flexibility or bonus payments by one standard deviation above the mean increase average overtime hours by more than 20 the findings are robust and suggest that surprise bonuses and flexible performance evaluations over time provide ef

the regulation of labor author s botero juan djankov simeon la porta rafael lopez de silanes florencio shleifer andrei abstract we investigate the regulation of labor markets through employment collective relations and social security laws in 85 countries we find that the political power of the left is associated with more stringent labor regulations and more generous social security systems and that socialist french and scandinavian legal origin countries have sharply higher levels of labor regulation than do common law countries however the effects of legal origins are larger and explain more of the variation in regulations than those of politics heavier regulation of labor is associated with lower labor force participation and higher unemployment especially of the young these results are most naturally consistent with legal theories according to which countries have pervasive regulaory styles inherited from the transplantation of legal systems

a deeper look at the proportionality turnout nexus evidence that turnout is higher under proportional representation pr than in majoritarian elections is overwhelming yet previous research has largely failed to explain why one line of argument maintains that higher turnout under pr is a by product of larger party systems however a larger number of parties has been demonstrated to depress turnout alternatively it is argued that majoritarian electoral systems tend to produce safe seats and that voters have little incentive to turn out there thus uneven turnout over electoral districts due to variable intensities of local competition is made responsible for the lower overall turnout empirical evidence on this conjecture is scant this article scrutinizes the relationship between electoral rules competition and turnout with district level data from 31 national elections results from a heteroscedastic model indicate that lower net turnout in majoritarian systems is indeed a consequence of uneven turnout over districts due to variable levels of lo

is political rivalry an incentive to vote according to the theory of the rational voter s behavior riker and ordeshook 1968 the decision to vote depends among other things on the expected effectiveness of his vote to bring to power his preferred candidate or party though this hypothesis is valid in the case of a two party political system in the case of a multi party system one has to take into consideration the influence of the competition2 between parties upon the vote s efficiency and on the distribution of the votes among parties3 in a multi party system quite often no one party is in a position to win an overal majority and the result is a governmental coalition therefore the voter is in more doubt about the effectiveness of his vote for a given number of parties the closer the outcome of the election the more likely people would be to vote see tullock 1972 110 an increase in the number of parties might be considered as contributing to a better representation of the electorate s preferences and therefore as an incentive to vote on the other hand when parties become too numerous there could be a weakening of power among them and that in turn would cancel out the incentive to vote therefore an optimal degree of competition encouraging electoral participation as shown in figure 1 must exist4 this paper will concentrate on the assessment of the explanatory power of the competition among parties upon the rate of electoral participation it should however not be overlooked that in practice there are many factors of an institutional as well as of a psychological nature which prevent such an ideal balance being attained factors affecting the voter s behavior such as compulsory participation tend to reduce considerably the margin between the expected benefit from voting and the costs the development of efficient lobbies considered by the voter to be more likely to support his preferences in parliament tend to reduce the

the performance of rational voter models in recent presidential elections in an economic theory of democracy downs hypothesized that rational utility maximizing citizens would calculate the benefits from voting as opposed to abstaining altogether and then vote if this expected benefit exceeded voting cost this hypothesis is logically derived from economic principles of rational behavior but is counterintuitive even if the utility increment is plausibly large the probability of casting a pivotal tie breaking vote in any sizable polity is minute hence the expected benefit will be less than the time cost of voting and no rational person will vote nevertheless a number of statistical studies have found that voter turnout does respond to differences in the probability of casting a decisive vote even though that probability may be small this article uses data gathered at the state level from the 1968 1972 1976 and 1980 general elections to reestimate the relationship between voter turnout and the probable closeness of the election pooled data least squares dummy variable lsdv regressions are used whenever preliminary tests indicate that such pooling is permissible the empirical results suggest that the relationship between closeness and turnout is weak unstable or nonexistent in all of the models tested

how much does money matter buying votes in japan 1967 1990 japanese elections are notorious for the money that flows between contributors politicians and voters to date however nobody has estimated statistically the impact of this money on electoral o

groups in rational turnout models a model of the strategic calculus of voting that incorporates the behavior of groups is presented if candidates choose different positions positive turnout is possible in partial equilibrium and is generally larger than that without group rationality nevertheless if candidates are probability maximizers and a unique general equilibrium exists the candidates will choose equivalent positions and turnout will be zero even with group rationality but if candidates care about both policy and winning they will choose different positions and cause positive turnout this turnout will be larger than that that would occur without group rationality group rationality alone cannot explain positive turnout in a general equilibrium theory of elections it does imply larger turnout in conjunction with policy oriented candidates than would be predicted solely by individualistic rational behavior

mobilization social networks and turnout evidence from japan the strategic elites model of turnout argues that elites mobilize more when the probability of their effort deciding the electoral outcome is greater although the literature assumes that this probability depends solely on how close the election is logically it depends jointly on how many votes are needed to affect the outcome closeness and on how many additional votes elite efforts are likely to garner vote yield because the vote yield of mobilizational effort varies with the social capital of the district that elites face the level of elite mobilizational effort hence turnout should depend interactively on closeness and social capital the authors test their predictions using data from japanese lower house elections for the years 1967 90 japan is an interesting test case both because its former electoral system differs from that for which the model was first developed and because the literature clearly stresses the role of elite mobilization through social networks but does not examine the particular hypotheses advanced here

electoral turnout in rational voting and consumption perspectives a single equation econometric model of voting participation behavior is developed within the context of rational voter and household investment consumption theories the model is tested using aggregate electoral district level data from 10 canadian provincial elections and the 1970 canadian census the regression estimates show substantial consistency across the various elections which comprise this study s data base despite considerable collinearity education and income appear to be strongly related to voting turnout in a manner which is consistent with the predictions of economic theory

the use of performance measures in incentive contracting the strength of incentives used in an organization and the productivity of employees that results from these incentives depend to a large degree on the characteristics of the performance measures available to the organization some employees work under high powered explicit incentive contracts while others have no explicit incentive contracts at all the ability of agency theory to predict the pattern of incentive provision in organizations has not been very impressive and the divergence between the prescriptions of agency theory and the actual practice of firms has been widely noted this paper along with both other papers in this session edward p lazear 2000 canice prendergast 2000 attempts to fill some of the gap between theory and practice i examine the characteristics of performance measures those data on which explicit incentive contracts are based to understand how firms use incentive contracting and to predict the use of incentives in practice