Political Uncertainty and Policy Innovation

Christos Kotsogiannis and Robert Schwager
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Robert Schwager: Zentrum fur Europische Wirtschaftsforschung Mannheim

No 111, Discussion Papers from University of Exeter, Department of Economics

Abstract: Conventional wisdom has it that outside sources of information enhance the capability of political institutions to separate selfish from benevolent incumbents. This paper investigates, in the presence of innovative public policies whose outcomes are uncertain, the role of outside information and shows that it is more involved than typically thought. While it is true that enhanced information helps in separating politicians, it also creates an externality that reduces the incentives to experiment with innovative public policies.

Keywords: Policy uncertainty; Political uncertainty; Fiscal federalism; Policy innovation; Experimentation. (search for similar items in EconPapers)
JEL-codes: D72 H1 (search for similar items in EconPapers)
Date: 2001-12
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Citations: View citations in EconPapers (2)

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Journal Article: Political Uncertainty and Policy Innovation (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:exe:wpaper:0111

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