Political Economy Models of Elections

Abstract

We review a large formal literature on economic models of voting and electoral politics. We discuss two broad classes of model: those focusing on preference aggregation and those that look at elections as mechanisms of information aggregation. We also explore the role of elections in situations of asymmetric information, where politicians take hidden actions or are otherwise better informed about policy than voters are, and examine the role of elections in selection and as incentive mechanisms. In the section on models of preference aggregation, we focus on the themes of exogenous candidacy, policy commitment, and the role of valence attributes. For information aggregation, we analyze how different aspects of the institutional environment affect aggregation, focusing on the structure of elections-whether simultaneous or sequential-and the number of choices, as well as the motivations of voters. Finally, in considering models of asymmetric information, we describe how these models shed new light on incumbency effects, campaign spending, and the policy choices of politicians.

Voting in a Multi-dimensional Space: A Conjoint Analysis Employing Valence and Ideology Attributes of Candidates

“…The link between income and competence, or valence more generally, may instead raise a few eyebrows. Yet, citizen-candidate models, which seek to fully endogenize candidacies by removing the distinction between the electorate and the political class and are particularly concerned with the qualities of politicians (Dewan and Shepsle 2011), unabashedly assign to income a strong connotation of valence as "a measure of market success and ability" (Galasso and Nannicini 2011, 79). For Caselli and Morelli (2004, 775), "voters use [candidates'] market incomes as a signal of their competence" in office.…”

Electoral Competition, Control and Learning

“…After all, by the time of the campaign, voters had already learned about the incumbent from his performance in office. This suggests that See recent articles by Dewan and Shepsle (2011) and Ashworth (2012) for a review of the agency and spatial modeling approach to elections. voters learn using role-specific technologies.…”

Who should cast the casting vote? Using sequential voting to amalgamate information

“…A general investigation of what we call jury voting is given in Ali et al (2008). Our work would fit into the information amalgamation portion of the survey of Dewan and Shepsle (2011). In discussing the work of Dekel and Piccione (2000), they observe that "because voters condition on the same event, namely that of being pivotal, it makes no difference whether they cast their votes sooner or later."…”

“…If those voting for A were overall of significantly higher abilities, then the casting voter might vote against his weak signal for B (assuming a tie vote). Dewan and Shepsle (2011) take account of this fact in a footnote where they say that "the individual with the casting vote conditions her vote on the set of observed actions." Dekel and Piccione (2000) also take account of voting order (in sequential voting) and conclude that (p. 48): …if voters are endowed ex ante with differential information (some voters can be better informed than other) knowing which voters voted in favor and which against can affect the choice of a later voter.…”