Essays on political economics
Keywords: Business.

This dissertation consists of four chapters on political economics. Chapter 1, titled "The Impact of 3G Internet on Political Accountability", studies the effect of 3G internet on the political accountability of elected officials. Using a difference-in-difference design by exploiting the gradual roll-out of 3G network across different congressional districts in the U.S., we find that an increase in 3G coverage significantly increases the legislative activities of the U.S. House representatives: they introduce more substantive and significant bills, and allocate more staffing resources to legislation. However, representatives devote less effort to constituency service: they are less likely to serve on constituency-oriented committees, and there is weak evidence of lower district spending and lower staffing resources for constituency service. One possible mechanism is that the 3G internet makes elected officials more attentive to the feedback from their online voter base that rewards more legislative activities than constituency service. Analyzing over 1 million Facebook posts of the representatives, we find that online voters interact significantly more with legislation-related posts, but they engage much less with constituency-related posts. Posting legislation-related content also significantly increases the campaign donations in the days after the post by a larger amount than posting constituency-related content. Our findings suggest that while elected officials are more likely to be held accountable for their legislative actions, there is less incentive for them to provide constituency service. Chapter 2, titled "Have Changes to Media and Technology Helped to Nationalize American Elections", analyzes the large increase in national fundraising in state and federal legislative elections and explores how it may relate in part to shifts in media and technology. To assess whether the decline in local political news might increase out-of-state campaign contributions, we leverage exogenous exposure to local television media markets. We find that people residing in out-of-state media markets contribute substantially more to out-of-state candidates, on average—consistent with the idea that people's donations are in part a function of what information they receive. Building a new dataset on candidate spending on Facebook ads for 2018 and 2020, we show that candidates at the federal level who spend more money on Facebook ads target more of their ads to people outside their states and raise more money from out-of-state donors, on average. Together, the results suggest that the changing media and technology environment may create incentives for some candidates to focus on raising money nationally rather than locally, contributing to the general nationalization of American politics today. Chapter 3, titled "Partisan Registration: A Truthful Statement or A Strategic Choice", examines the nature of partisan registration: is it a truthful revelation of an individual's party identification, or is it a strategic choice for the purpose of voting in partisan primaries? Although scholars have widely used party affiliation as a proxy for party identification, no study has examined if it is a sincere expression of partisan attachment. My study offers a framework to analyze the conditions under which voters may or may not register for strategic reasons. Empirically, using a regression discontinuity design with individual-level voter file data from New York, I find no evidence of strategic party registration. My findings suggest that individuals might derive significant psychic benefit from truthfully registering with the party that best reflects their political beliefs. Chapter 4, titled "Local Environment and Political Beliefs", focuses on the political segregation in American neighborhoods. Specifically, I study how local environment affects individuals' political beliefs. Using individual-level data from administrative voter files, I perform an event study and a quasi-experiment to show that the local political environment significantly affects individuals' political affiliation. I also find a larger effect on Republican voters in their twenties than on Democratic voters or voters from other age groups, which is consistent with the hypothesis that the change in party affiliation is a result of environmental change, because young Republicans are more likely to experience a substantial change in the political environment as they move to more urban areas. My results suggest that the local political environment may have a substantial impact on individuals' political beliefs, thereby reinforcing the political homogeneity of American neighborhoods.