politicians outside earnings and electoral competition this paper deals with the impact of electoral competition on politicians outside earnings in our framework politicians face a tradeoff between allocating their time to political effort or to an alternative use generating outside earnings the main hypothesis is that the amount of time spent on outside work is negatively related to the degree of electoral competition we test this hypothesis using a new dataset on outside earnings of members of the german federal assembly and find that politicians facing low competition have substantially higher outside earnings

macroeconomic policy in a two party system as a repeated game this paper considers the interaction of two parties with different objectives concerning inflation and unemployment and rational and forward looking wage setters if discretionary policies are followed an economic cycle related to the political cycle results in equilibrium this cycle is significantly different from the traditional political business cycle reputational mechanisms due to the repeated interaction of the two parties and the public or commitments to a common policy rule can improve upon the discretionary outcome by reducing or eliminating the magnitude of the economic fluctuations

legislative professionalism and incumbent reelection the development of institutional boundaries it is well established that legislators from highly professionalized bodies are more likely to win reelection than members of less professionalized legislatures we find that the effect of professionalization on incumbent electoral success is far more pervasive as the level of professionalism of a legislature increases the effects of external political and economic forces such as coattails from higher level elections and national economic conditions on a legislator s chances for reelection diminish in strength this implies that legislative professionalization promotes institutionalization by establishing boundaries that insulate members from external shocks we reach these conclusions by specifying and testing a district level model of state legislative election outcomes using as dependent variable the probability that an incumbent will win reelection the model is estimated with probit using data for more than 42 000 state legislators from 1970 to 1989 w hat determines whether a legislator seeking reelection will win we address this question by paying particular attention to the role of professionalization of legislatures in influencing the electoral success of members we know that american legislators are highly likely to win reelection garand 1991 jacobson 1987 king 1991 we also know that those from highly professionalized institutions have even better odds than those from less professionalized bodies as the former have greater resources for travel to their districts holbrook and tidmarch 1991 for casework cox and morgenstern 1993 1995 king 1991 and for devoting time and energy to campaign activities carey niemi and powell 2000 we maintain however that professionalism does more than boost the electoral prospects of incumbents it changes members relationships with the legislature s political and economic environment in particular professionalization promotes legislative institutionalization by

u s presidential elections 1968 80 a spatial analysis a methodology is presented for empirical estimation of spatial models of voting in mass elections the basic choice model posits utility functions that depend on spatial distance and a random error term the parameters of the utility functions are estimated by a polytomous logit model which is applied to spatial maps of voters and candidates for all presidential elections since 1968 these maps indicate that presidential candidates take positions at the periphery of the distribution of voters results based on these maps support the hypothesis of sincere spatial voting in two candidate elections in three candidate elections the coefficients of the voter utility function adjust to proxy for the lesser viability of the minor party candidate in contrast to choice turnout shows only weak spatial effects the data are inconsistent with the proposition that turnout is low because voters are not offered distinct alternatives while the utility function used by voters appears stable through time and candidate and voter positions appear stable in the last few months prior to an election voter and candidate positions exhibit substantial change over longer time periods

involuntary unemployment reconsidered a recent paper by reuven brenner 4 reveals a continuing tendency to discuss keynes s notion of involuntary unemployment primarily as an ethical matter a matter of social justice less attention has been devoted to the analytical content of the concept despite the fact that the issue was joined at least as early as viner s 36 classic review of the general theory keynes apparently still was dissatisfied with his own development of the concept at that time replying to viner keynes 19 210 acknowledged the need for improvement of the definition and treatment of involuntary unemployment in the general theory despite his dissatisfaction with his own definition and treatment keynes seemed to have felt the idea was elementary and fundamental to his theory once economists had cast off their classical skins they could intuit the concept with ease but casting off the old skins was the hard task nevertheless once that was accomplished keynes tended to embrace a wide variety of ways of expressing the notion of involuntary unemployment

the theoretical developments initiated by haberler but named for pigou do not provide sufficient grounds for rejecting keynes s key theoretical proposition this paper examines a claim made in the introduction to milton friedman s presidential address to the american economic association and that is now taken for granted in orthodox economics according to friedman the theoretical developments initiated by haberler but named for pigou provide sufficient grounds for rejecting keynes s key theoretical proposition and the economics of keynes in its entirety the problem with this claim is that it turns out given the scrutiny that it clearly deserves to be false the theoretical developments initiated by haberler but named for pigou do not provide sufficient grounds for rejecting keynes s key theoretical proposition and thus the economics of keynes as a whole there is no legitimate rationale for believing in other words even in a world of flexible prices that the system will tend naturally toward a position of equilibrium at full employment

divided we vote divided government is known to correlate with limited government but less is understood about the empirical conditions that lead to divided government this paper estimates the determinants of continuous and categorical measures of divided government in an empirical macro political economy model using 30 years of data from the american states voters support more divided government after increased government spending per dollar of tax revenues but more unified government after worsening incomes and unemployment rates only conditional support is found for the strategic moderating theory alesina and rosenthal in econometrica 64 6 1311 1341 1996 that focuses purely on midterm cycles and split ticket voting absent economic conditions

a theory of ambiguity credibility and inflation under discretion and asymmetric information this paper develops a positive theory of credibility ambiguity and inflation under discretion and asymmetric information the monetary policymaker maximizes his own politically motivated objective function that is positively related to economic stimulation through monetary surprises and negatively related to monetary growth the relative importance he assigns to each target shifts stochastically through time his current preference trade off is known to him but not to the public when choosing the state contingent path of money growth for the present and the future the policymaker compares the benefits from current stimulation with the costs associated with higher future inflation expectations current monetary growth conveys information to the public about future money growth because there is persistence in the policymaker s objectives although expectations are rational information is imperfect because monetary control procedures are imprecise as a result the public cannot correctly distinguish persistent changes of emphasis on different policy objectives from transitory monetary control errors the public becomes aware of changes gradually by observing past monetary growth credibility is defined in terms of the speed with which the public recognizes changes in the objectives of the policymaker credibility is lower the noisier monetary control and the more stable the objectives of the policymaker looser monetary control and a higher degree of time preference on the part of the policymaker induce him to produce higher and more variable monetary growth when the policymaker is free to determine the accuracy of monetary control he does not always choose the most effective control available in spite of the fact that monetary surprises always have an expected value of zero the reason is that ambiguous control procedures enable the policymaker to generate positive surprises when he cares more than on average about economic stimulation he leaves the inevitable negative surprises for periods in which he cares more about inflation prevention this result provides an explanation for the fed s preference for ambiguity recently documented by goodfriend 1986 the policymaker is more likely to pick more ambiguous control procedures the more uncertain his objectives and the higher his time preference the paper also provides a theoretical underpinning for the well documented crosscountry positive correlation between the level and the variability of inflation

mps for sale returns to office in postwar british politics many recent studies show that firms profit from connections to influential politicians but less is known about how much politicians financially benefit from wielding political influence we estimate the returns to serving in parliament using original data on the estates of recently deceased british politicians applying both matching and a regression discontinuity design to compare members of parliament mps with parliamentary candidates who narrowly lost we find that serving in office almost doubled the wealth of conservative mps but had no discernible financial benefits for labour mps conservative mps profited from office largely through lucrative outside employment they acquired as a result of their political positions we show that gaining a seat in parliament more than tripled the probability that a conservative politician would later serve as a director of a publicly traded firm enough to account for a sizable portion of the wealth differential we suggest that labour mps did not profit from office largely because trade unions collectively exerted sufficient control over the party and its mps to prevent members from selling their services to other clients

credibility and policy convergence in a two party system with rational voters the traditional approach to modeling political parties behavior based upon the contribution of anthony downs 1957 assumes that the parties unique objective is to win elections thus they maximize their popularity the crucial implication of this assumption for a two party system is that if the two parties have the same information about voters preferences full convergence of policies results from electoral competition this is the crucial implication of the median voter theorem more generally it may be argued that different parties are motivated differently because they represent different constituencies parties may not care only about winning elections per se but also about the quality of the policies resulting from an election in this case the candidates of the two parties view winning an election not only as a goal per se but also as a means of implementing a better policy for their respective constituencies this paper shows that electoral competitions imply dynamic inconsistency if the voters are modeled as rational and forwardlooking agents and parties do not care exclusively about being elected but also about which policy to implement once elected the dynamic inconsistency arises as follows the parties have an incentive to announce convergent platforms to increase their chances of election however if the elected party is not committed to its electoral platform it has an incentive to follow its most preferred policy rather than the policy announced in its platform if voters are rational they account for this incentive thus in general in a one shot electoral game the only timeconsistent equilibrium is one in which no convergence is possible the two parties follow their most preferred policies and the voters rationally expect this outcome full convergence of parties platforms results only as a limiting case when the parties are completely indifferent with respect to the quality of the policies resulting from the election thus these results differ from the existing literature on ideologically motivated politicians for instance donald wittman 1977 1983 randall calvert 1985 which implicitly assumes the possibility of binding commitments to electoral platforms complete or partial policy convergence can be the outcome of political competition if the interaction between the parties and the voters is modeled as an infinitely repeated game in fact if the candidates have concave objective functions the welfare maximizing policy rule implies a complete convergence of parties policies however this cooperative and agreed upon policy may or may not be sustainable as a subgame perfect equilibrium depending on parameter values in particular it depends on the discount rates of the two parties the degree of polarization of their preferences and the relative popu graduate school of industrial administration carnegie mellon university pittsburgh pa 15213 and national bureau of economic research cambridge ma 02138 this paper is based upon a chapter of my unpublished doctoral dissertation at harvard university i am greatly indebted to jeffrey sachs for directing my attention toward these issues and for many conversations i also wish to thank andrew abel dilip abreu olivier blanchard ramon caminal andrew caplin alex cukierman morris fiorina benjamin friedman herschel grossman howard rosenthal and the referees for very useful comments the responsibilitv af anv n mtnkieis af calrirp nfnlv mine the result of policy convergence in a two party system is more general than the median voter theorem for discussions of convergence results not at the median see john ledyard 1984 peter coughlin 1984 coughlin and shmuel nitzan 1981 melvin hinich 1977 for earlier work on spatial competition see richard mckelvey 1975 hinich ledyard and peter ordeshook 1972 1973 and the references quoted therein the present paper focuses on the result of convergence rather than on the median voter theorem per se

tourism in the balearic islands a dynamic model for international demand using panel data abstract the balearic islands are one of the most important tourist destinations in the mediterranean sea the tourism sector dominates the economic activity of the islands the purpose of this study is to identify and measure the impact of the main determinants of the inbound international tourism flows the annual panel data set includes the number of arrivals from the 14 most important generating countries during the period 1991 2003 and a number of possible explanatory variables taking into account the changing structure of consumer preferences a dynamic model is estimated the estimated coefficient for the lagged dependent variable may be reflecting the importance of consumer loyalty to the destination as a determinant of tourism demand the results suggest that the demand is heavily dependent on the evolution of economic activity in each of the origin countries and on the relative cost of living of tourists in the destination this study also suggests that diversification of promotion and provision of high quality services are some recommended measures of tourism policy

nonconstant reputation effect in a dynamic tourism demand model for spain abstract following the ideas of the tourism area life cycle talc theory we propose a dynamic econometric model for tourism demand where the reputation effect the effect of the lagged demand on the current tourism demand is not constant but dependent on congestion we test the model using panel data from spanish regions during the period 2000 2013 two estimations are performed depending on whether the tourists origin is domestic or international the results show that the reputation effect is not constant in both estimates supporting the idea that tourism congestion influences tourist arrivals in spain

political parties world demand and unemployment domestic and international sources of economic activity this article replicates and extends earlier work on the politics of macroeconomic policy by considering political effects on unemployment in 14 western industrial nations between 1960 and 1983 changes of party control of government display broadly the expected effects namely that unemployment falls under left wing governments and rises under right wing governments however the principal conclusions of this article are that partisan effects on unemployment in open economies that is economies heavily dependent on trade with other countries can only be satisfactorily estimated relative to the constraint imposed by the level of world economic activity and that in addition to politicians strategic incentives political institutions and economic regime constraints also determine whether partisan effects on unemployment will be sustained transitory or absent with respect to the latter on the whole no effects are found where no such effects were promised by the new government before taking office where one party or dominant partner coalitions form the effect on unemployment is transitory whereas where broad coalitions form it is sustained or absent finally ceteris paribus any partisan effects are more likely where governments secure parliamentary majorities

a new view of political accountability for economic performance most political support models imply that in evaluating economic performance voters use a standard that would provide poor predictions of the future and leave the economy vulnerable to manipulation by vote hungry politicians drawing on macroeconomic theory we develop a simple standard of evaluation which encompasses a concern not only for current economic outcomes but also for accurately assessed future consequences of current policies we find that political support for the president can be explained as well by models that assume that voters use this sophisticated standard as by models that assume voter naivete our analysis questions the wisdom of measures typically used to assess voter evaluation of economic performance in a variety of theoretical contexts the results also help to explain the absence of convincing evidence that governments exploit voter ignorance in manipulating the economy

a time to make laws and a time to fundraise on the relation between salaries and time use for state politicians we study the relationship between the level of compensation and time use for us state legislators using survey data on time use we show that higher salary is robustly associated with legislators spending more time on fundraising in contrast higher salary is also robustly associated with less time spent on legislative activities and has no clear relation to time spent on constituent services the fundraising results are particularly strong for legislators who do not intend to run for higher office our results are consistent with an interpretation that higher salary raises the value of office and politicians respond with more fundraising because increased fundraising raises the chance of getting re elected more than does increased legislative activity back of the envelope calculations suggest that a 30 000 increase in salary is associated with politicians annually devoting 13 more hours to fundraising and 18 fewer hours to legislative activity resume un temps pour faire les lois et un autre pour lever des fonds etude du rapport entre le salaire et l emploi du temps des legislateurs d etat dans cet article nous examinons le lien entre le niveau de remuneration et l emploi du temps des legislateurs d etat aux etats unis en nous appuyant sur plusieurs donnees d enquetes relatives a la gestion du temps nous montrons que plus leur salaire est eleve plus les legislateurs ont tendance a consacrer du temps a lever des fonds le temps devolu aux activites legislatives ayant quant a lui tendance a diminuer sans lien evident avec le temps passe en circonscription au service des citoyens les resultats relatifs aux levees de fonds sont particulierement forts des lors que les legislateurs ne briguent pas de plus hautes fonctions et sont conformes a l interpretation selon laquelle un salaire eleve accroit l interet pour une fonction et puisque l augmentation des activites de financement ne se traduit pas par davantage d activites legislatives mais par des chances de reelection accrues les politiciens multiplient les levees de fonds des calculs rapides et approximatifs suggerent qu une hausse du salaire des politiciens de 30 000 par an representerait 13 heures de collecte de fonds en plus mais 18 heures d activites legislatives en moins annuellement

presidential popularity and macroeconomic performance are voters really so naive f ollowing the pioneering work of kramer 1971 numerous studies have analyzed the relationships between the macroeconomic performance of political administrations and their popularity or vote getting ability kramer s work showed that the aggregate congressional vote for an incumbent party can be explained rather well by variables indicating recent economic performance subsequent works have extended kramer s research by explaining presidential vote or gallup poll popularity data with similar models on one point almost all of these studies agree 2 votes and popularity can be explained well by models which suppose that voters judge policymakers on the basis of retrospective evaluation of past macroeconomic outcomes most authors interpret their results as being supportive of the hypothesis of rational voters since the evidence indicates that voting decisions are not based purely upon personalities party affiliation or chance kramer argued that if voters regard past macroeconomic performance of an administration to be indicative of future performance then a concern with past performance indicates a concern for future performance voters who simply extrapolate from the past to predict the future are rather naive however a sophisticated voter who has an understanding of the important intertemporal constraints embodied in the structure of the economy would be able to forecast future consequences of current policy choices more accurately than one who simply extrapolates if votes and popularity are simply functions of past outcomes then voters must either be ignorant of the basic structure of the economy or unconcerned with the future the supposition that voters are so naive might run counter to the intuition of most economists who generally assume individual rationality as a central behavioral postulate nevertheless the empirical results noted above have been accepted by many as evidence that voters do misperceive their own long run interest the implications of the naive voter hypothesis for macroeconomic policymaking are disturbing nordhaus 1975 has developed a model which shows that voter naivete can encourage vote maximizing politicians to induce political business cycles and an inflationary bias there is some but not unanimous empirical support for the existence of politically motivated business cycles and casual empiricism also suggests that politicians themselves believe in the naive voter 3 while studies show that empirical evidence is consistent with the notion that voters are concerned with the recent past the results do not reject a sophisticated voter hypothesis none of the aforementioned studies has tested a model consistent with a sophisticated voter hypothesis i e a model in which voters understand what outcomes are feasible in the long and short runs and are concerned with future as well as current and past economic performance in this paper we develop such a model and estimate it using gallup poll data on presidential popularity results of this model are compared to results from a naive voter model similar to those employed in previous research received for publication february 4 1982 revision accepted for publication july 30 1982 university of south carolina i am grateful for helpful comments provided by ray fair douglas hibbs william keech daniel richards abel l da costa fernandes and an anonymous referee i also wish to thank william keech for providing me with the gallup poll data on presidential approval rates aurel schubert provided excellent research assistance fair 1978a bloom and price 1975 arcelus and meltzer 1975 and pollard 1981 a 1981 b have all estimated models to explain voting while frey and schneider 1978 and hibbs i 982a 1982b have developed models to explain presidential popularity 2 an exception is provided by arcelus and meltzer 1975 3nordhaus 1975 and tufte 1978 have provided evidence of political business cycles for a number of western democracies and frey and schneider 1978 and maloney and smirlock 1981 have estimated policy reaction functions suggesting that the timing of elections affects policymaking see tufte for a discussion of casual empirical evidence indicating that politicians believe that current economic conditions affect electoral outcomes

inflation and unemployment the world economy today is vastly different from the 1930s when seymour harris the chairman of this meeting infected me with his boundless enthusiasm for economics and his steadfast confidence in its capacity for good works economics is very different too both the science and its subject have changed and for the better since world war ii but there are some notable constants unemployment and inflation still preoccupy and perplex economists statesmen journalists housewives and everyone else the connection between them is the principal domestic economic burden of presidents and prime ministers and the major area of controversy and ignorance in macroeconomics i have chosen to review economic thought on this topic on this occasion partly because of its inevitable timeliness partly because of a personal interest reaching back to my first published work in 1941

equilibrium political budget cycles political business cycle theories generally rely on nominal rigidities and voter myopia this paper offers an equilibrium theory that preserves some basic insights from earlier models though with significant refinements the political budget cycle emphasized here is in fiscal policy rather than output and inflation it arises via a multidimensional signal process one can consider the welfare implications of proposals to mitigate the cycle and the effects of altering the electoral structure copyright 1990 by american economic association

academic tourism demand in galicia spain the last few decades have witnessed a dramatic increase in the mobility of higher education students when fulfilling certain conditions this type of mobility can actually be considered a type of tourist activity this paper justifies the choice of the term academic tourism to describe such a form of tourism further to this its primary purpose is to identify the main determinants that drive the demand of academic tourism in galicia an empirical analysis has been carried out using a dynamic panel data model by a generalized method of moments gmm contrary to what can be observed in other types of tourism the results suggest that academic tourism depends mainly on determinants that are not strictly economic namely the relevance of the habits and preferences of students the potential for differential attractiveness of the university of santiago de compostela and the significant impact of the erasmus programme in light of these results policy implications are then discussed

a positive theory of fiscal deficits and government debt this paper considers an economy in which policymakers with different preferences alternate in office as a result of elections government debt is used strategically by each policymaker to influence the choices of his successors if different policymakers disagree about the desired composition of government spending between two public goods the economy exhibits a deficits bias that is debt accumulation is higher than it would be with a social planner the equilibrium level of debt is larger the larger is the degree of polarization between alternating governments and the less likely it is that the current government will be re elected

the demand for international tourism in the mediterranean region the paper studies the demand for international tourism in the mediterranean region first a review of the most important attempts to model econometrically the demand for international tourism in the past is given followed by a formal presentation of the proposed theoretical model in particular a version of the almost ideal demand system aids is adopted and a description of the variables involved and their sources together with the estimation procedure are provided the diagrammatic analysis performed contributes to a better understanding of the evolution of the dependent variable over time the results with respect to the expenditure as well as to the own and cross price elasticities may be regarded as econometrically satisfactory and a reasonable economic explanation is given

dynamic pivotal politics we analyze a dynamic extension of a parsimonious model of lawmaking in which preferences evolve over time and today s policy becomes tomorrow s status quo unlike in existing models of pivotal politics policy makers voting behavior depends on the institutional environment and on their expectations about future economic and political shocks relative to sincere voting the equilibrium behavior exhibits a strategic polarization effect which increases with the degree of consensus required by the institution the volatility of the policy environment and the expected ideological polarization of the future policy makers the equilibrium behavior also exhibits a strategic policy bias which works against any exogenous policy bias embedded in the voting rule our analysis implies that the existing literature underestimates the inertial effect of checks and balances and overestimates the impact of institutional biases such as fiscally conservative budget procedures

incumbent performance and electoral control in the pure theory of electoral competition citizens compare the platforms of the candidates and vote for the one whose platform is preferred candidate strategies are identified with promises about future performance in office models of this sort have been developed in both static mckelvey 1975 and dynamic kramer 1977 i settings and all appear to have the property that if the set of alternatives is large enough in some sense equilibrium platforms rarely exist but these models have another feature that is quite as disturbing as their instability in the static setting discussed by mckelvey little attention is paid to the possibility that once in office the politician s preferences may diverge from those of his constituents and that he may therefore choose policies at variance from his platform instead it is simply assumed that promises will be kept whether or not such behavior is congruent with the interest of the officeholder it is sometimes argued that an enforcement mechanism may exist to discipline politicians for failing to keep promises but without a specification of the mechanism it is not obvious that it would be in the interests of the

inbound international tourism to canary islands a dynamic panel data model abstract this paper presents a dynamic model of international tourism demand to canary islands the empirical analysis exploits the panel structure of the dataset for the 15 most important countries of origin of tourists over the period 1992 2002 by a generalized method of moments estimation of a dynamic model taking into account unobserved country specific effects the preferred model is the gmm diff proposed by arellano and bond however other models are also shown for comparison a dynamic model where the lagged dependent variable is included as regressor is used to obtain short run and long run elasticities problems arising from the non stationarity of data are dealt with by using a model in first differences the estimated coefficient for the lagged depended variable is always significant and may reflect a high degree of consumer loyalty or an important effect of word of mouth in determining demand of international tourism in brief the results suggests that tourism demand to canary islands must be considered as a luxury good and is highly dependent on the evolution of relative prices and cost of travel between origin and destination country

divided government in the american states a byproduct of legislative professionalism s since world war ii divided government has become increasingly common in the american states a significant component of the increase is the deterioration of republican fortunes in state legislatures after the 1990 and 1992 elections for example only five state legislatures were controlled by the republicans i shall examine the hypothesis that the professionalization of state legislatures makes legislative service more attractive to democratic candidates and less attractive to republican candidates because full time legislative service is incompatible with another career and democrats on average have less lucrative career opportunities than republicans statistical analysis of post world war ii legislative elections outside the south is consistent with the argument other things being equal every ten thousand dollar increase in real biennial legislative compensation is associated with approximately a 1 increase in democratic legislators

political parties and the business cycle in the united states 1948 1984 this paper tests the existence and the extent of a politically induced business cycle in the u s in the post world war ii period the cycle described in this paper is different from the traditional political business cycle of nordhaus it is based on a systematic difference between the monetary policies of the two parties in a model with labor contracts from an explicit optimization problem we derive a system of equations for output and money growth then we successfully test the non linear restriction imposed by the theory on the parameters of the system of equations we cannot reject the hypothesis that money growth has been systematically different under the two types of administration and that this difference contributes to explain output fluctuations

policy oriented voting in response to economic issues this study explores the hypothesis that voting in response to economic problems is policy oriented voters concerned about unemployment ore predicted to give greater support to democratic candidates while those concerned about inflation are predicted to vote more republican in light of evidence from previous research this study investigates the electoral effects of inflation and unemployment as 1 problems directly experienced by the individual and 2 problems deemed serious for the nation as a whole support is strongest for the unemployment side of the hypothesis voters personally affected by unemployment gave a modest boost to democratic candidates in virtually every election and in years of high unemployment the large percentage of voters who fell it was a serious national problem voted heavily democratic as well this study concludes by discussing the important implications these findings have for our understanding of how economic conditions influence voting behavior in american national elections

when to risk it institutions ambitions and the decision to run for the u s house the health of any democratic system depends on political ambition to generate a steady supply of quality candidates for office because most models of candidate entry assume ambition rather than model it previous research fails to understand its roots in individual and institutional characteristics we develop a two stage model of progressive behavior that distinguishes between the formation of ambition for higher office and the decision to enter a particular race using data from a survey of state legislators we demonstrate that the intrinsic costs and benefits associated with running for and holding higher office shape ambitions but do not influence the decision to run for progressively ambitious legislators the second stage decision is a strategic choice about when to run rather than whether to run our research highlights how institutional characteristics that foster progressive ambition also increase the likelihood that national or local political conditions will be translated into meaningful choices at the ballot box

what s a losing party to do the calculus of contesting state legislative elections existing theories of contesting elections typically treat all potential challengers as identical while under playing the importance of political parties and primary contests we offer a theory addressing these issues based on how the various actors in the process define and evaluate the probability of winning an election and the value of the office being contested we test our theory by estimating a model predicting which of three responses a party that loses a legislative race makes in the next cycle nominating the same candidate nominating a new candidate or nominating no one we find substantial empirical support for our theory

pay for politicians and candidate selection an empirical analysis abstract a growing theoretical literature on the effect of politicians salaries on the average level of skills of political candidates yields ambiguous predictions in this paper we estimate the effect of pay for politicians on the level of education of parliamentary candidates we take advantage of an exceptional reform where the salaries of finnish mps were increased by 35 in the year 2000 intended to make the pay for parliamentarians more competitive a difference in differences analysis using candidates in municipal elections as a control group suggests that the higher salary increased the fraction of candidates with higher education among female candidates while we find no significant effect for male candidates

partisan cycles in congressional elections and the macroeconomy in the postwar united states the president s party has always done worse in the midterm congressional elections than in the previous congressional election republican administrations exhibit below average and democratic administrations above average economic growth in the first half of each term whereas in the latter halves the two see equal growth our rational expectations model is consistent with these two regularities in presidential elections voters choose between two polarized candidates they then use midterm elections to counterbalance the president s policies by strengthening the opposition in congress since presidents of different parties are associated with different policies our model predicts a spurious correlation between the state of the economy and elections our predictions contrast with those of retrospective voting models in which voters reward the incumbent if the economy is doing well before the election our model performs empirically at least as well as and often better than alternative models

political control and public sector savings evidence from the states the right to access and ultimately spend public sector savings is determined by the party which can control the politicaloutcome this implies that anticipatedfuture changes in the state s controllingpolitical party may systematicallyadversely affect current savings extendingthe life cycle permanent income model ishow that a representative legislator willopt to forgo current saving in favor ofspending when his prospects for futurepolitical control diminish estimating apanel data model of 39 states from1973 1995 i find that an actual futurechange in the controlling party of astate s lower house significantly reducescurrent saving

presidential elections and federal reserve policy an empirical test traditional macro economic models of federal reserve fed behavior typically assume that the fed enjoys a well defined objective function based on social welfare and generally predict counter cyclical monetary policy the increasing observation of procyclical monetary policy has led many researchers to investigate new models of fed behavior several recent papers imply that procyclical fed behavior is due to a lack of political accountability friedman 7 toma 23 and shughart and tollison 21 all attribute considerable bureaucratic discretion to the fed and seek to explain monetary policy by examining typical bureaucratic objectives other papers such as pierce 19 20 weintraub 26 and kane 10 11 argue that the fed operates in an arena filled with political constraints that cause sub optimal monetary policy but these constraints are not modeled explicitly one possible political constraint on fed behavior is the incumbent president s desire for re election in the political business cycle pbc literature presidential re election opportunities are enhanced by the production of a precise set of inflation and unemployment outcomes leading up to the election thus to the extent that presidents desire cyclical macro economic outcomes there will be executive pressure on the fed to create or accommodate such outcomes the effect this pressure will have on fed policy is ultimately an empirical question but most models deal with it by assumption traditional macro modeling assumes a zero effect while the pbc models implicitly assume that a favorable election cycle is a primary goal of all economic policymakers this paper examines presidential influence on the federal reserve by testing for an election cycle in money growth the major result is the identification of a regular 16 quarter cycle in money growth corresponding with presidential elections this cyclical effect is found to be stable over time and significant under a wide range of model specifications further when the cyclical component of money growth is used to simulate a simple macro model it produces a classic political business cycle in inflation and real output growth

the ecological fallacy revisited aggregate versus individual level findings on economics and elections and sociotropic voting several aggregate level studies have found a relationship between macroeconomic conditions and election outcomes operating in intuitively plausible directions more recent survey based studies however have been unable to detect any comparable relationship operating at the individual voter level this persistent discrepancy is puzzling one recently proposed explanation for it is that voters actually behave in an altruistic or sociotropic fashion responding to economic events only as they affect the general welfare rather than in terms of self interested pocketbook considerations it is argued here that the discrepancies between the macro and micro level studies are a statistical artifact arising from the fact that observable changes in individual welfare actually consist of two unobservable components a government induced and politically relevant component and an exogenous component caused by life cycle and other politically irrelevant factors it is shown that because of this individual level cross sectional estimates of the effects of welfare changes on voting are badly biased and are essentially unrelated to the true values of the behavioral parameters of interest they will generally be considerable underestimates and may even be of the wrong sign an aggregate level time series analysis on the other hand will often yield reasonably good if somewhat attenuated estimates of the underlying individual level effects of interest thus in this case individual behavior is best investigated with aggregate rather than individual level data it is also shown that the evidence for sociotropic voting is artifactual in the sense that the various findings and evidence which ostensibly show sociotropic behavior are all perfectly compatible with the null hypothesis of self interested pocketbook voting

predicting the institutional effects of term limits in this paper we develop a model to predict the seniority turnover and transition consequences of term limit reforms for any institution with a regularized procedure for rotating membership with this model we can predict the number of members who will be serving in their last term at any given time once an institution reaches a stable state under term limit reforms for example our results show that for the u s senate current term limit proposals will result in a substantial increase in the number of lame duck members and a significant reduction in average seniority we make no claims as to the public policy effects of term limit proposals however our model can be used to design a proposal that will maximize any benefits or minimize any public policy effects found to be associated with term limit reforms

explaining legislators positions on outside income limits voting on honoraria ceilings in the u s senate 1981 1983 this article examines roll call voting by members of the u s senate on three proposals to limit members outside income in the 1980s i find that several factors influenced legislators votes on outside income limits legislation oill first financial self interest was an important constraint on members willingness to support oill members who earned more honoraria were less likely to vote yes but this opposition was neutralized when limits were attached to the compensating mechanism of a pay raise senators from poorer states were generally more likely to support honoraria limits alone but less likely to support limits linked to a pay raise suggesting a responsiveness to constituent interests in both cases finally when oill was linked to a pay raise electoral considerations became prominent in legislators vote decisions with electorally vulnerable members less likely to vote yes

a partisanship theory of fiscal and monetary regimes this paper indicates that income redistribution motivated by the distributive ideals of liberal political p arties create unanticipated disincentives for productive effort thi s suggests that newly elected liberal parties are likely to engage in monetary surprises in order to compensate for the adverse effects of these disincentives on real income estimated reaction from function s support these predictions a measure of income redistribution the change in the ratio of the social expenditures of government to gnp has a positive significant effect on money growth in addition when the presidency changes from conservative to liberal there is a posit ive and significant increase on money growth copyright 1987 by ohio state university press