\makeatletter \let\ifGm@compatii\relax \makeatother \documentclass[12pt]{beamer} %use for presentation % \documentclass[12pt,handout]{beamer} %use for handouts \setbeameroption{show notes} %uncomment to see notes \usefonttheme{serif} \usefonttheme{structuresmallcapsserif} \newcommand{\its}{\vskip 10pt \item} \newcommand{\pits}{\vskip 10pt \pause \item} \newcommand{\st}{\operatorname{st}} \newcommand{\var}{\operatorname{var}} \newtheorem{prop}{Proposition} \newcommand{\R}{\mathbb{R}} \newcommand{\E}{\mathbb{E}} \newcommand{\BR}{\operatorname{BR}} %\newtheorem{theorem}{Theorem} \newcommand{\un}{\underline} \newcommand{\ov}{\overline} \newcommand{\gp}{\succ} \newcommand{\lp}{\prec} \newcommand{\gep}{\succsim} \newcommand{\lep}{\precsim} \newcommand{\T}{\ensuremath{\mbox{\footnotesize\textsc{occupation}}}} \renewcommand{\S}{\ensuremath{\mbox{\footnotesize\textsc{suicide}}}} %\newcommand{\R}{\ensuremath{\mbox{\footnotesize\textsc{religious}}}} \usepackage{graphicx} \usepackage{ragged2e} % ----------------------------------------- % Center the Frame Title % ----------------------------------------- \setbeamertemplate{frametitle} { \begin{centering} \vspace{0.1in} \insertframetitle \par \end{centering}} % ----------------------------------------- % Number the slides % ----------------------------------------- \setbeamertemplate{footline}[frame number] % ----------------------------------------- % Get rid of the irritating navigation bar % ----------------------------------------- \setbeamertemplate{navigation symbols}{} % ----------------------------------------- % Begin Document % ----------------------------------------- \title[]{Influence over Elected Officials} \author{} % Ethan Bueno de Mesquita\\ \small{Harris School of Public Policy Studies}\\ \small{University of Chicago}} \date[]% (optional, should be abbreviation of conference name) % Delete this, if you do not want the table of contents to pop up at % the beginning of each subsection: \AtBeginSection[] { \begin{frame}{Outline} \tableofcontents[currentsection,currentsubsection] \end{frame} } % Delete this, if you do not want the table of contents to pop up at % the beginning of each subsection: \AtBeginSubsection[] { \begin{frame}{Outline} \tableofcontents[currentsection,currentsubsection] \end{frame} } \begin{document} \begin{frame} \titlepage \end{frame} \begin{frame}{Rent Seeking} Using policy to benefit a particular group, rather than the public good \ Classic Examples \begin{itemize} \item Agricultural subsidies \its Professional licensing \its Mortgage deduction \its Tax expenditures \end{itemize} \end{frame} \begin{frame}{The Role of Elections} \begin{quotation} \noindent The aim of every political constitution is, or ought to be, first \textbf{to obtain for rulers men who possess most wisdom to discern, and most virtue to pursue, the common good} of the society; and in the next place, to take the most effectual precautions for \textbf{keeping them virtuous whilst they continue to hold their public trust}.\end{quotation} \ \hskip 25pt Madison, Federalist 57 \end{frame} \section{Particularistic Interests} \begin{frame}{Responsive Voters} Reelection oriented politicians will target policies to benefit citizens whose votes are responsive to those policy choices \ Sources of responsiveness \begin{itemize} \item Low level of ideological, ethnic, or partisan attachments \its Single issue voters \its Districting \its Low voter turnout \its Concentrated interests \end{itemize} \end{frame} \begin{frame}{Simple Model} Two candidates, $a$ and $b$, who care only about winning office \ Three groups of voters: $a$-partisans ($A$), $b$-partisans ($B$), and independents ($I$) \ No group is a majority on its own, but any two groups are \end{frame} \begin{frame}{Three Platforms} \textbf{Efficient} ($x_E$): Each group gets $1$ \ \textbf{Partisan-biased} ($x_A$ or $x_B$): Relevant partisans gets $\pi > 1$, while all other voters get 0 \ \textbf{Independent-biased} ($x_I$): Independents get $\pi$, while all other voters get 0 \ Biased platform is inefficient, but preferred by privileged group \end{frame} \begin{frame}{Voters} After observing the platforms, voters decide for which candidate to vote \ Independent voters' payoffs come only from the platform \ Partisan voters also care about the identity of the politician in office \begin{itemize} \item Extra benefit $\eta >0$ if partisan-aligned candidate wins \end{itemize} \ If voters are indifferent, they flip a coin. \end{frame} \begin{frame} \begin{figure} \includegraphics[width=\textwidth]{figures/di_lo.pdf} \end{figure} \ If partisans highly attached (unresponsive), platforms targeted to independents \ If partisans weakly attached (responsive), platforms are efficient \end{frame} \begin{frame}{Does GOTV Solve Unresponsiveness?} \begin{figure} \includegraphics[width=\textwidth]{figures/gotv.pdf} \end{figure} \end{frame} \begin{frame}{Key Lesson} Politicians pursue policies that benefit those citizens whose votes are responsive to policy choice \ If some group's vote is certain, can't attract policy benefits \ Rent seeking goes to responsive voters \ California Electoral Code changed in 1980s allowing school boards to shift from off- to on-cycle elections. In newly on-cycle districts: \begin{itemize} \item Turnout doubles \its Teacher salaries decreased by \$1,000 \end{itemize} \end{frame} \section{Money and Politics} \begin{frame}{Possible Mechanisms} Quid-pro-quo \ Access and persuasion \ Money helps aligned candidates win elections \end{frame} \begin{frame}{How Much Money?} Top 50 donor industries \begin{itemize} \item 106th Congress: \$370 million \item 109th Congress: \$445 million \end{itemize} \ Perhaps \$5 billion in current presidential campaign \end{frame} \begin{frame}{Tullock Paradox} \begin{quotation}\noindent In 1972, when Tullock raised this question, campaign spending was about \$200 million. Assuming a reasonable rate of return, such an investment could have yielded at most \$250--300 million over time, a sum dwarfed by the hundreds of billions of dollars worth of public expenditures and regulatory costs supposedly at stake.\end{quotation} \end{frame} \begin{frame}{Donations and Expenditures by Industry, 2000} Defense \begin{itemize} \item Donations: \$13.2 million \item Expenditures: \$134 billion \end{itemize} \ Oil and gas \begin{itemize} \item Donations: \$33.6 million \item Subsidies: \$1.7 billion \end{itemize} \ Agriculture \begin{itemize} \item Donations: \$3.3 million \item Commodity loans and price supports: \$22.1 billion \end{itemize} \ Rate of return is too high (6000 to 1) for this to be a market \end{frame} \begin{frame}{Votes and Money} Lobbies provide contributions and votes---both matter \ Rate of return is for both \ Goes a long way to address Tullock's puzzle \begin{itemize} \its 2 million farmers \its Estimate each of their votes worth \$400 to incumbents \its Return to contribution now down to \$0.13 per \$1 contributed \end{itemize} \end{frame} \begin{frame} \begin{quotation} \noindent If I get a contribution from, say, Allied-Signal, a big defense contractor, and they've raised money for me. And then they come in and say, `Senator, we need legislation that would extend some rule of contracting that’s good for us.' They lay out the case. My staff goes over it. I'm trying to help them. Why am I trying to help them? The cynic can say: `Well, it's because they gave you 5,000 bucks. And if you ran again, they'll give you another 5,000 bucks.' Or is it because they have 15,000 jobs in Arizona and this will help keep those jobs in Arizona? Now to me, the far greater motivation is those jobs, because those are the people that are going to vote for me. But I can't ignore the fact that they have given me money--Dennis DeConcini (D-AZ)\end{quotation} \end{frame} \begin{frame} \frametitle{The Largest Employer Does Not Pay The Most} \begin{figure} \includegraphics[scale=.5]{figures/trebbi1.pdf} \end{figure} \end{frame} \begin{frame} \frametitle{No Industry Pays The Most Where It Is The Largest Employer} \begin{figure} \includegraphics[scale=.5]{figures/trebbi2.pdf} \end{figure} \end{frame} \begin{frame} \frametitle{} \begin{figure} \includegraphics[scale=.4]{figures/trebbi3.pdf} \end{figure} \end{frame} \begin{frame} \frametitle{} \begin{figure} \includegraphics[scale=.4]{figures/trebbi4.pdf} \end{figure} \end{frame} \begin{frame}{Would Campaign Finance Reform Have a Big Effect?} Marginal vote costs approximately \$200 \begin{itemize} \item Hard to see how donors could be buying policy \end{itemize} \ Little to no evidence of policy responsiveness to donations \ Institutional donors (industry, unions, corporations) are less polarized in their giving patterns than are individuals \end{frame} \section{Accountability} \begin{frame}{Madison's Two Purposes of Elections} Fostering a ``dependence on the people'' and ``keeping them virtuous'' \ ``to obtain for rulers [leaders] who possess most wisdom to discern, and most virtue to pursue, the common good of the society'' \end{frame} \begin{frame}{A Model} Three players: an incumbent, a challenger, and a voter \ Each politician may be \emph{high quality} or \emph{low quality} \begin{itemize} \item High quality with probability $p \in (0,1)$ \end{itemize} \ In each period, incumbent chooses effort, $e_1 \in [0,1]$ (not observed by voter) \ Policy outcome is \emph{good} or \emph{bad} \begin{itemize} \item High quality politician always achieves good outcome \its Low quality politician achieves good outcome with probability $e_1$ \end{itemize} \ Election between periods \end{frame} \begin{frame}{Payoffs} Politician gains a benefit $B$ if win election and bears costs of effort $e^2$ \ Voter cares only about good policy outcomes \end{frame} \begin{frame}{2nd Period and Election} No incumbent exerts effort \ Good outcome if politician in office is high type \ At election, voter wants to maximize probability of high type \ Reelect if and only if good outcome in first period \end{frame} \begin{frame}{First Period Effort} \[ \max_{e_1} e_1 B - (e_1)^2.\] \ \[ e_1^* = \frac{B}{2}.\] \ Probability of a good outcome: \[ \Pr(\mbox{Good Outcome}) = p + (1-p)\frac{B}{2}.\] \end{frame} \section{Evidence} \subsection{Term Limits} \begin{frame} \frametitle{Brazilian Mayors and Term Limits} Brazil highly decentralized \begin{itemize} \its Local governments receive large sums of resources to provide public services such as education, health care, transportation, and local infrastructure \its Decision on how to spend these resources is made by an elected mayor in conjunction with a local council of elected legislators \end{itemize} \ Mayors limited to two terms \begin{itemize} \its Exogenous variation in reward to good performance \end{itemize} \end{frame} \begin{frame} \frametitle{de Janvry, Finan, and Sadoulet, 2011} Brazilian conditional cash transfer program meant to keep children in school \begin{itemize} \its Typically more eligibles than funds \its Up to local official to target funds to minimize dropout \end{itemize} \ Implemented nationwide in 2001 \begin{itemize} \item Exogenously (by accident of history), some mayors were term limited in 2001 and some weren't \end{itemize} \ Large variation in success of program across cities (mean reduction in dropouts is 8\%) \end{frame} \begin{frame} \frametitle{} \begin{figure} \includegraphics[scale=.6]{figures/finan1.pdf} \end{figure} \end{frame} \begin{frame} \frametitle{} \begin{figure} \includegraphics[scale=.6]{figures/finan2.pdf} \end{figure} \end{frame} \begin{frame} \frametitle{} \begin{figure} \includegraphics[scale=.6]{figures/finan3.pdf} \end{figure} \end{frame} \begin{frame}{Ferraz and Finan, 2011} Brazilian government audits cities for corruption, some before and some after election, and announces results \begin{figure} \includegraphics[scale=.6]{figures/finan4.pdf} \end{figure} \end{frame} \subsection{Incentives and Selection} \begin{frame}{Disentangling Two Effects} Disentangle incentive and competence effects using variation in term limits \ \alert{Incentive Effect}: Compare 1st term eligible to 1st term ineligible \ \alert{Competence Effect}: Compare 1st term ineligible to 2nd term ineligible \end{frame} \begin{frame}{Disentangling Two Effects} \begin{figure}\begin{center} \includegraphics[scale=.6]{figures/abr-results.pdf}\end{center} \end{figure} \end{frame} \subsection{Information and Accountability} \begin{frame}{Adding Information to the Model} Suppose voter only correct perceives a good outcome with probability $\pi \in (1/2,1)$ \ \[ e_1 = \frac{\pi B}{2}\] \ Lowers incentives and likelihood of good outcome \end{frame} \begin{frame}{Challengers} Official who faces a specific challenger faces more strenuous monitoring than one who faces a retention election \ Examine in a quantitative case study of judges in Kansas \begin{itemize} \its Districts differ in electoral form \its Directly look at covariate differences across forms \its Also have a rich set of case-level controls \end{itemize} \end{frame} \begin{frame}{Electoral Geography of Kansas} \begin{figure} \includegraphics[scale=.7]{figures/sandy1.pdf} \end{figure} \end{frame} \begin{frame} \frametitle{The Results} \begin{figure} \includegraphics[scale=.7]{figures/sandy2.pdf} \end{figure} \end{frame} \begin{frame} \frametitle{Media} Congruence of congressional district and media market as source of exogenous variation in voter information \ See whether more information improves performance (as suggested in the accountability model) \ Congruence is high if the primary newspaper sources in a county cover primarily that county's congressional representative \begin{itemize} \its Imagine a county near a city in the same congressional district: congruence is high \its Imagine a county near a city in a different congressional district: congruence is low \end{itemize} \end{frame} \begin{frame}{Congruence} \begin{figure}\vskip -.25in \includegraphics[scale=.75]{figures/cong.pdf} \end{figure} \end{frame} \begin{frame}{Identification Strategies} Comparing counties within a given state in a given year \ Compare counties within a particular congressional race \ Compare a particular county, that got redistricted, to itself \end{frame} \begin{frame}{The Results} \begin{figure} \includegraphics[width=.8\textwidth]{figures/sn_st.pdf} \end{figure} \end{frame} \begin{frame}{South Carolina School Boards} Make standardized test score reporting less informative \begin{itemize} \item 2000: report raw scores \its 2002: report 4 point scale, most schools in same category \end{itemize} \ Berry and Howell (2007) look at relationship between incumbent vote share and change in test scores before and after this change in reporting system \ Our model predicts relationship should be stronger in 2000 than in 2002 \end{frame} \begin{frame} \begin{figure} \includegraphics[scale =.6]{figures/berry-howell.pdf} \end{figure} \end{frame} \begin{frame}{Are Incentives Always Good?} In our model, the key to reelection was good policy outcomes \ We also have models in which the key to reelection is choosing popular policies, even if they turn out to be wrong \ If electoral incentives primarily give rise to such pandering, things that increase electoral incentives are bad, rather than good \end{frame} \section{Take Aways} \begin{frame}{Take Aways} Electoral concerns create incentives to target policy to benefit responsive voters \ The extent to which money influences policy remains open question, but votes also matter \ Electoral accountability plays at least two roles in affecting the quality: incentives and electoral selection \ Several factors affect the magnitude of incentives created by elections: benefits of office, term limits, voter information, the presence of challengers \ Electoral incentives can be good or bad, depending on what determines reelection \end{frame} \end{document}