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Institutional flexibility, political alternation and middle-of-the-road policies

Author

Listed:
  • Ascensión Andina Díaz

    (Department of Economics, University of Málaga)

  • Francesco Feri

    (Department of Economics, Royal Holloway, University of London)

  • Miguel A. Meléndez-Jiménez

    (Department of Economics, University of Málaga)

Abstract
Empirical observation shows that policies are usually gradually introduced in a society. This paper presents a model of repeated elections that captures this phenomenon, and that allows countries to differ in their institutional flexibility, thus in the speed of implementation of new policies. We show that with gradual implementation of policies there is an incentive for the voters to vote, each election, to a different party. Hence, our model produces equilibria with alternation. We further show that there is a tradeoff between efficiency and stability, with efficiency requiring moderate policies and stability pushing towards polarization. Last, we show that except for the partisan equilibria, the most stable ones convey policies that are bounded away from both the median and the extremes, with policies polarizing more when institutions are either too flexible or sufficiently rigid.

Suggested Citation

  • Ascensión Andina Díaz & Francesco Feri & Miguel A. Meléndez-Jiménez, 2018. "Institutional flexibility, political alternation and middle-of-the-road policies," Working Papers 2018-07, Universidad de Málaga, Department of Economic Theory, Málaga Economic Theory Research Center.
    • Handle: RePEc:mal:wpaper:2018-7
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    References listed on IDEAS

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    Cited by:

    1. Andina-Díaz, Ascensión & Feri, Francesco & Meléndez-Jiménez, Miguel A., 2023. "The bureaucracy trap," Economics Letters, Elsevier, vol. 228(C).
      • Ascensión Andina-Díaz & Francesco Feri & Miguel A. Meléndez-Jiménez, 2022. "The Bureaucracy Trap," Working Papers 2022-03, Universidad de Málaga, Department of Economic Theory, Málaga Economic Theory Research Center.
    2. Loeper, Antoine & Dziuda, Wioletta, 2024. "Voters and the trade-off between policy stability and responsiveness," Journal of Public Economics, Elsevier, vol. 232(C).

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    More about this item

    Keywords

    gradual implementation of policies; political alternation; polarization and moderation; efficiency; robustness;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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