Working Paper: NBER ID: w2468
Authors: Alberto Alesina; Alex Cukierman
Abstract: Politicians have generally two motives: they wish to hold office as long as possible and wish to implement their preferred policies. Thus they face a trade-off between the policies which maximize their choices of reelection and their most preferred policies (or the policies most preferred by the constituency which they represent). This paper analyzes this trade-off in a dynamic electoral model in which the voters are not fully informed about the preferences of the incumbent. First, we show that in general there is incomplete policy convergence: the incumbent follows a policy which is intermediate between the other party ideal policy and his own ideal policy. Second, we show that under some circumstances, the incumbent has an incentive to choose procedures which make it more difficult for voters to pinpoint his preferences with absolute precision. Thus, politicians may prefer to be ambiguous and "hide", at least up to a certain extent, their true preferences. This result holds for a wide range of parameter values and, in some range, even if voters are risk averse.
Keywords: Political Economy; Electoral Competition; Ambiguity
JEL Codes: D72; D78; H11
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Incumbent's policy choice (D72) | Likelihood of re-election (D72) |
| Voter perceptions of policy outcomes (D72) | Likelihood of re-election (D72) |
| Ambiguity in policy (D80) | Voter's ability to ascertain incumbent’s true preferences (D72) |
| Incumbent's choice of ambiguity (D80) | Likelihood of re-election (D72) |
| Voter risk aversion (D72) | Likelihood of re-election (D72) |
| Incumbent's ideological preferences (D72) | Incumbent's policy choice (D72) |
| Opposing party's preferences (D72) | Incumbent's policy choice (D72) |