Working Paper: NBER ID: w31441
Authors: Hitoshi Shigeoka; Yasutora Watanabe
Abstract: Staggered difference-in-differences designs are pervasive in policy evaluations but little is known about the mechanisms of policy diffusion: How and why do such policies spread across jurisdictions? In this study, we highlight the role of elections in policy diffusion in settings where municipal elections are asynchronous due to historical reasons. First, we empirically show the presence of policy diffusion using neighbors’ election cycles as instruments for neighbors’ policy adoption. Second, we further demonstrate interactions of municipalities’ election cycles with neighbors’ adoption and show that they follow neighbors’ policy only during their own election timing, indicating that policy diffuses through elections.
Keywords: No keywords provided
JEL Codes: D04; D78; H73; H75
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Timing of elections (K16) | Policy changes (increasing eligibility age for child healthcare subsidies) (I18) |
| Neighbors' election cycles (D72) | Policy changes (increasing eligibility age for child healthcare subsidies) (I18) |
| Policy changes (increasing eligibility age for child healthcare subsidies) (I18) | Competitive policy diffusion (F68) |
| Election timing (K16) | Policy generosity (H55) |
| Experience of politicians (D72) | Policy adoption timing (D78) |