{"title":"To act or not to Act? Political competition under different types of backward-looking voters","authors":"Arthur Fishman , Doron Klunover","doi":"10.1016/j.ejpoleco.2025.102723","DOIUrl":"10.1016/j.ejpoleco.2025.102723","url":null,"abstract":"<div><div>We present a model of political competition in which an incumbent politician may implement a costly policy to prevent a possible bad outcome. A competent politician is privately informed about the posterior probability of that outcome and an incompetent one only knows the prior probability. After the policy is implemented, it may be unknown whether or not it was required. We demonstrate that, under these conditions, a competent politician leverages her private information only when voters base their decisions solely on the policy's outcome rather than on what it may indicate about the incumbent's future performance.</div></div>","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102723"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661343","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Identity, social media and online political activism","authors":"Swaraj Kumar Dey, Shubhasis Dey","doi":"10.1016/j.ejpoleco.2025.102653","DOIUrl":"10.1016/j.ejpoleco.2025.102653","url":null,"abstract":"<div><div>When exposed to repeated incongruent information about the stated position of a favoured candidate, the feeling of betrayal that voter's experience not only induces them to change their voting decision but also prompts them to partake in political activism. Using the lens of identity and the framework of social psychology, the paper further argues that fear of reprisal holds back vulnerable identity groups from engaging in political activism, in general, and in online political activism (OPA), in particular. Employing an innovative experimental design involving 500 participants, the paper's findings indicate that vulnerable socio-economic and linguistic groups exhibit greater reluctance to participate in OPA compared to their non-vulnerable counterparts. (JEL D91, C99, A12, J15, Z13)</div></div>","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102653"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661356","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Sourav Das , Patrick Hufschmidt , Fabian Mankat , Konstantinos Theocharopoulos
{"title":"Reprint of: Political budget cycles in federal systems: The case of India","authors":"Sourav Das , Patrick Hufschmidt , Fabian Mankat , Konstantinos Theocharopoulos","doi":"10.1016/j.ejpoleco.2026.102831","DOIUrl":"10.1016/j.ejpoleco.2026.102831","url":null,"abstract":"<div><div>This paper examines Political Budget Cycles in federal systems, focusing on how a central incumbent allocates discretionary transfers across states in response to electoral incentives. We develop a theoretical model predicting that average discretionary transfers increase during federal election periods. While swing states consistently receive higher transfers due to their electoral competitiveness, the election-period increase is larger for non-swing states. This occurs because non-swing states are targeted primarily during federal elections: allocating transfers to them in state elections is not advantageous for the federal incumbent, as it has little effect on the probability of winning those state elections. To test these predictions, we compile a panel dataset of Indian states from 2006 to 2022. Using fixed effects specifications, we find evidence consistent with the theoretical model: discretionary transfers are significantly higher in federal election periods, swing states receive more discretionary transfers in non-election periods, and the election-period increase in discretionary transfers is more pronounced for non-swing states.</div></div>","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102831"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661339","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Democracy as a competitive discovery process","authors":"Nick Cowen , Eric Schliesser , Aris Trantidis","doi":"10.1016/j.ejpoleco.2025.102695","DOIUrl":"10.1016/j.ejpoleco.2025.102695","url":null,"abstract":"<div><div>Actors within democracies and markets exhibit opportunistic behavior and frequently pervasive ignorance. But the debate on whether these social systems can handle these problems is polarized. Critics of markets point to corporate greed and consumer exploitation, placing faith in democracy as the antidote; while critics of democracy highlight rent-seeking, public ignorance and limited knowledge for decisionmakers, prioritizing markets over democracy. By contrast, we argue that there is a fundamental alignment between how competition in both politics and markets ameliorate these two challenges to facilitate social cooperation. Democracy works as a ‘competitive discovery process’ comparably, though not identically, to the way imperfect markets manage to produce goods and services for consumers. Competition in democratic politics and relatively competitive markets both compel and enable key players – particularly large firms and political elites – to be alert and responsive to diverse preferences in society, thereby harnessing opportunistic self-interest and ameliorating knowledge to produce some good outcomes for society as a whole. One important feature of our argument is that we treat the discovery process in democracy and markets as a mechanism of continuous identity formation. On the epistemic properties of democracy, our contribution lies in relaxing both the neoclassical assumption of perfect competition and the Hayekian ideal of open competition by focusing on the performance of imperfectly competitive dynamics.</div></div>","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102695"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661746","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Should you want an educated mayor? Evidence from close elections in Italy","authors":"Alessio Mitra","doi":"10.1016/j.ejpoleco.2024.102636","DOIUrl":"10.1016/j.ejpoleco.2024.102636","url":null,"abstract":"<div><div>This paper studies the impact of politicians’ education on policy choices and public finance. A probabilistic voting model with candidates’ education level<span> and public expenditure decomposition is used to explain how politician’s education matters for policy decisions over public budget allocation. Empirically, I use Italian municipality data on electoral results, balance sheets and mayor candidates’ educational attainment from 2000 to 2015. To estimate the causal effect of mayors’ education on public finance I rely on regression discontinuity design focusing on close elections. Overall, I find that educated mayors boost public investment, especially in the education sector, without compromising the fiscal stability of the municipalities.</span></div></div>","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102636"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661742","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Why new parties (must) make excessive campaign pledges","authors":"Giulio Piccirilli","doi":"10.1016/j.ejpoleco.2025.102679","DOIUrl":"10.1016/j.ejpoleco.2025.102679","url":null,"abstract":"<div><div>In an electoral race between an established and a new party, the new party extracts administrative competence from a negatively distorted distribution compared to the established party. During the electoral campaign, candidates make binding announcements on fiscal measures. In equilibrium, to manipulate the beliefs of voters about their competence, parties announce the provision of an amount of public goods which is excessive with respect to the social optimum.</div><div>The model predicts that, due to the chance that new parties may turn out to be very incompetent, these parties announce more excessive measures with respect to established parties. The model also predicts that political incumbents are favoured with respect to challengers even when they both extract the same competence and even if, through the signal mechanism, voters are aware that competence is the same.</div></div>","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102679"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661337","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Political competition and its consequences: Introduction and overview","authors":"Frank Bohn , Stanley L. Winer","doi":"10.1016/j.ejpoleco.2026.102813","DOIUrl":"10.1016/j.ejpoleco.2026.102813","url":null,"abstract":"","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102813"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661743","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Rules alone won't do: Empirical evidence on sanction mechanisms of fiscal rules and political budget cycles","authors":"Lukas Mair, Martin Mosler","doi":"10.1016/j.ejpoleco.2025.102682","DOIUrl":"10.1016/j.ejpoleco.2025.102682","url":null,"abstract":"<div><div>We examine the empirical relationship between the sanction mechanisms of fiscal rules and the spending composition across multiple expenditure categories of Swiss sub-national cantons during election periods. Using data from 1992 to 2021, we find that cantons without fiscal rules spend 37.9 Swiss Francs per capita or 3 percent of a standard deviation more on education during election periods, while cantons with fiscal rules but no associated sanction mechanisms in case of non-compliance increase per capita spending on public order by 34.2 Swiss Francs or 11 percent of a standard deviation. In contrast, cantons with fiscal rules that include sanction mechanisms exhibit no statistically significant change in their spending behavior. Our findings suggest that fiscal rules without sanction mechanisms only alter but do not prevent budgetary election effects, while fiscal rules with sanction mechanisms effectively mitigate political budget cycles.</div></div>","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102682"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661338","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The impact of independent local parties on spending: Evidence from Dutch municipalities","authors":"Marianna Sebő , Raymond Gradus , Tjerk Budding","doi":"10.1016/j.ejpoleco.2024.102603","DOIUrl":"10.1016/j.ejpoleco.2024.102603","url":null,"abstract":"<div><div>To what extent do independent local political parties make different decisions on municipal spending categories compared to their locally operating national counterparts? In this paper, we empirically analyze whether independent local parties affect public finances in Dutch municipalities. Using a matching strategy, we compare municipalities that are similar in their observable characteristics except for the presence of an independent local party majority in the municipal council. We provide evidence that municipalities with independent local majorities indeed differ in terms of local spending, specifically they spend more on categories of Local Public Administration, Public Health and Environment and Sport, Culture and Recreation which are arguably more locally oriented. Using a regression kink design, we find consistent results in spending when we look at the changes that take place once the majority share of the seats in the municipal council has been reached by independent local parties.</div></div>","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102603"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661354","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Electoral plutocracy","authors":"Raul Magni-Berton , Simon Varaine","doi":"10.1016/j.ejpoleco.2025.102713","DOIUrl":"10.1016/j.ejpoleco.2025.102713","url":null,"abstract":"<div><div>Previous research shows that elected governments primarily follow the preferences of high-income citizens, but the reasons for this remain controversial. In the present paper, we introduce a new synthetic measure of electoral plutocracy, i.e. the relative electoral weight of the rich compared to the poor for a given government in a parliamentary regime. The index takes into account three sources of electoral distortion that may favor the rich: (i) the conversion of persons into votes (turnout), (ii) the conversion of votes into seats (representation), (iii) the conversion of seats into government portfolios (coalition). Using survey data on parliamentary democracies since the late 1990s, we show that, on average, a person above the median income is electorally worth 1.16 times a person below the median income (and a person from the 10th decile is electorally worth 1.48 times a person from the 1st decile). This is mainly explained by higher turnout and higher participation in governing coalitions of parties supported electorally by the rich. Finally, we illustrate the interest of our index by re-testing the Meltzer–Richard hypothesis on the link between income inequality and redistribution. We show that the positive effect of inequality on redistribution is moderated by the level of electoral plutocracy.</div></div>","PeriodicalId":51439,"journal":{"name":"European Journal of Political Economy","volume":"92 ","pages":"Article 102713"},"PeriodicalIF":2.4,"publicationDate":"2026-03-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"147661335","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}