“The Stabilizing Effects of Disagreeing on Everything”
In the classic spatial model of office-motivated candidate competition, equilibrium exists only if the distribution of voter ideal points has a total median, a condition which is virtually never met. However, in the classic model, both candidates can propose policies anywhere in policy space, and this is a crucial element in proving the necessity of that condition. If each candidate may only propose policies from a subset of policy space, does an equilibrium exist more generally?
In answering this question, the role of parties in spatial competition can be assessed, because parties restrict the set of policies their candidates can credibly propose. If an equilibrium does exist more generally, then it implies that political parties have a stabilizing effect on political competition. In contrast, independent candidates may actually destabilize political competition, precisely because of their ability to propose any policy. The classic model, in which equilibrium virtually never exists, is essentially competition between independents.
I consider a model in which each of two office-motivated candidates proposes a policy from a distinct policy set. When the policy sets are convex and one does not contain the proposed equilibrium policy, it need not be the case that the proposed policy is a total median, because any competing proposal must be at least some positive distance away, and may only lie in certain directions; hence, the conditions of Plott (1967) do not apply. Instead, it is only necessary for each median hyperplane to lie in a given halfspace formed by the hyperplane separating the proposed equilibrium from the closest policy the opponent can propose. The intersection of all of the halfspaces is the set of guaranteed supporters of the equilibrium policy, that is, the set of voters for whom the equilibrium policy is closer than any alternative the opposing candidate can propose. Hence, the requirement on the median hyperplanes for the proposed policy to be an equilibrium is that one can choose a median voter on each median hyperplane to be a guaranteed supporter of the proposed policy.
“The Insufficiency of Full Transparency” (Job Market Paper)
(Under Revision, Check Back Later!)
Incumbent politicians have incentives to disregard or act contrary to their private information in order to signal competence to voters. When voters observe the incumbent’s actions or their outcomes, the politician changes her behavior to signal the existence of positive private information, creating a tradeoff between accountability and selection. Consequently, more transparency can lower voter welfare in equilibrium. However, if the incumbent did not have private information, there would be no possibility of signaling, and so there should be no reason for the incumbent to ignore information. If politicians do not have private information or take any hidden action, do they necessarily make decisions about risky policies in a welfare-maximizing way?
Transparency is increasingly prescribed as a remedy to many political problems. While existing research shows that incumbents may be induced to behave poorly by increasing transparency, it is possible that with a sufficient degree of transparency, it becomes welfare enhancing. If eliminating all private information still diminishes welfare, then understanding why this is so may provide clues for alternative reforms.
I consider a two period model of an office-motivated incumbent faced with a risky policy decision. In the first period, the incumbent will receive a signal about her competence, which is then revealed to voters. The incumbent then chooses between policy implementation and inaction to maximize her expected probability of reelection. Inaction reveals no further information about her competence, while implementation reveals her competence with certainty. Voters observe the incumbent’s choice and its outcome, if applicable, and update their beliefs about the incumbent. The belief about the competence of the challenger is then drawn from a unimodal CDF, and voters reelect the incumbent if and only if the belief about her is higher than that of the challenger. For comparison, I then consider the case when the signal is not revealed to the voters. If the incumbent chooses inaction with private information, then voters must vote on the basis of the expected signal conditional on inaction. This informational change implies the probability of reelection after inaction is now common across types, rather than type specific.
Incumbents fail to behave optimally in the full transparency equilibrium, and may even minimize welfare. Incumbents with high signals are risk averse and choose inaction to avoid reputational risk, while incumbents with low signals are risk loving and gamble by implementing policy. In private information, welfare may be strictly higher. Intuitively, to encourage incumbents with strong signals to implement policy, the beliefs when voters observe inaction must be sufficiently low. To encourage incumbents with low signals to choose inaction, the beliefs must be sufficiently high. This outcome is impossible when the private signal is known to voters, but possible when it is kept private.
“Campaigning to Persuade”
When candidates decide which positions to take on major issues, they must always bear in mind the difficulty of selling those positions to the voters. Candidates for office spend enormous resources attempting to persuade voters about the merits of their policy platforms. However, such persuasion is mostly absent from models of spatial competition. While there is a growing literature on Bayesian Persuasion, in which politicians design policy experiments “optimally” to convince voters to support a given idea or candidate, to the best of my knowledge, there is little research on the effect of persuasion on the choice of policy position. If voters’ policy preferences are determined stochastically by the positions of the alternatives offered, what kinds of equilibria would exist?
The answer to this question could provide another explanation for policy divergence, which is a long-standing puzzle in political economy. It could also explain why initially unpopular positions are sometimes victorious and why voters often change their policy positions in relatively short time frames.