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Abstract
We develop a model of electoral accountability with primaries. Prior to the general
election, the supporters of each of two parties decide which candidates to nominate. We
show that supporters suffer from a fundamental tension: while they want politicians
who will faithfully implement the party's agenda in office, they need politicians who can
win elections. Accountability to supporters fails when supporters fear that by punishing
or rewarding their incumbent for her loyalty or lack thereof, they unintendedly increase
the electoral prospects of the opposing party. Therefore, accountability decreases with
the importance that supporters assign to the elections, and it breaks down in two
cases. First, a popular incumbent safely defects as she knows she will be re-nominated.
Second, an unpopular incumbent defects because she knows she will be dismissed even
if she follows the party line. These behaviors are labeled impunity and damnation
respectively, and are illustrated with case studies.
"The
Lesser Evil: Executive Accountability with Partisan Supporters" (with Erik Snowberg), forthcoming in Journal of Theoretical Politics.
News Posted: 21 November 2011 [
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The paper is joint work with Parikshit Ghosh and was published in
Economic and Political Weekly of India, October 8, 2011, Vol. XLVI, No 41, it is available
here. A shorter version can be accessed
here.
Abstract: The 2011 Land Acquisition and Rehabilitation and Resettlement Bill on land acquisition recently tabled in Parliament is well-intentioned but seriously flawed. Its principal defect is that it attaches an arbitrary mark-up to the historical market price to determine compensation amounts. This will guarantee neither
social justice nor the efficient use of resources. The Bill also places unnecessary and severe conditions on land acquisition, such as restrictions on the use of multicropped land and insistence on public purpose, all of which are going to stifle the pace of development without promoting the interests of farmers.
We present an alternative approach that will allow farmers to choose compensation in either land or cash, determine their own price instead of leaving it to the government’s discretion, and also reallocate the remaining farmland in the most efficient manner. Our proposed method involves a land auction covering not only the project site but also the surrounding agricultural land.
News Posted: 14 October 2011 [
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Oliver Vanden Eynde, PhD student at EOPP has won the "Banco de Portugal - Lisbon Meeting Best Paper Award" for his paper titled "Targets of violence: Evidence from India's Naxalite Conflict".
This work was presented at the "Lisbon Meeting on Institutions and Political Economy". This is Oliver's second award, after winning the "Economic History Society New Researchers' Prize" for his paper "Military Service and Human Capital Accumulation: Evidence from Colonial Punjab" presented at the "2011 Economic History Society Annual Conference".
You can find more about Oliver's research on his
personal website.
News Posted: 13 October 2011 [
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Incentives and the de Soto Effect
The paper is forthcoming in
Quarterly Journal of Economics and can be found here.
Abstract: This paper explores the consequences of improving property rights to facilitate the use of fixed assets as collateral, popularly attributed to the influential policy advocate Hernando de Soto. We use an equilibrium model of a credit market with moral hazard to characterize the theoretical effects, and also develop a quantitative analysis using data from Sri Lanka.
We show that the effects are likely to be non-linear and heterogeneous by wealth group. They also depend on the extent of competition between lenders. There can be significant increases in profts and reductions in interest rates when credit markets are competitive. However, since these are due to reductions in moral hazard, i.e. increased effort, the welfare gains tend to be modest when cost of effort is taken into account. Allowing for an extensive margin where borrowers gain access to the credit market, can make these effects larger depending on the underlying wealth distribution.
News Posted: 10 October 2011 [
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