Electoral competition and endogenous political institutions: Quasi-experimental evidence from Germany

Thushyanthan Baskaran and Mariana Lopes da Fonseca

No 237, University of Göttingen Working Papers in Economics from University of Goettingen, Department of Economics

Abstract: Do established parties change political institutions to disadvantage smaller, nonmainstream parties if the latters´ electoral prospects improve? We study this question with a natural experiment from the German federal state of Hesse. The experiment is the abolishment of an explicit electoral threshold (the so called "five percent hurdle") for local elections in 2001 by the Hessian state parliament. The abolishment improved the electoral prospects of smaller parties at local elections, but local politicians from large mainstream parties had the ability to adjust municipal political institutions in such a way as to counteract the increased competitiveness of smaller parties. One such institutional adjustment is to reduce the size of the local council and thereby raise implicit electoral thresholds. Using a dataset that covers all 426 Hessian municipalities over the period 1989-2011, we document with a difference-indiscontinuity design that municipalities where the electoral competitiveness of smaller parties improved more because of the abolishment of the explicit threshold, reduced their council size more. Hence, established parties appear to erect barriers to entry by adjusting political institutions once new political formations become viable electoral alternatives.

Keywords: electoral rules; electoral thresholds; political competition (search for similar items in EconPapers)
JEL-codes: D70 D72 D78 (search for similar items in EconPapers)
Date: 2015
New Economics Papers: this item is included in nep-cdm and nep-pol
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Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Electoral competition and endogenous political institutions: Quasi-experimental evidence from Germany (2016)
Working Paper: Electoral competition and endogenous political institutions: quasi-experimental evidence from Germany (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:cegedp:237

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