Essays on the Political Economy of Electoral Competition

Abstract

This dissertation consists of three chapters which develop various models of multi-dimensionalelectoral competition. In the first chapter I study a model of electoral competition between two parties who are polarized on cultural issues, and consider the effect this has on economic policy. Generically, division on social issues leads to polarization on economic policy. And under reasonable parameter settings this division induces a conservative bias in economic policy. In the second chapter I develop a model of electoral competition in which voters care aboutpotentially many different policy issues. The electoral equilibrium can be described by essentially two summary dimensions, with one dimension capturing the conflict between the two parties, and another populist dimension describing the conflict between party elites and voters. Increasing parties’ uncertainty about voters’ preferences leads to more divergent platforms on the first dimension, and more elitist platforms on the second. I then apply this model to study parties’ incentives for learning in repeated elections. I assume that parties learn about voters’ policy preferences by observing vote-shares from an election. What parties learn depends on the platforms voters are asked to evaluate. If parties are farsighted, they prefer not to learn voters’ preferences, and they moderate their platforms on the main axis of ideological conflict to slow the rate of learning. The reason why is that more precise information intensifies competition on the populist dimension of politics, which party leaders would rather cooperate to avoid. In the third chapter I study a model of electoral competition between multiple parties in a proportional representation system. I ask whether increased competition as measured by the numberof parties leads to better convergence to voters’ preferred policies. I find that if voters care about multiple policy dimensions then increasing the number of parties ameliorates polarization in party platforms if and only if parties receive some non-policy office benefits. But the effect of competition is only partial, with the level of polarization tending to a non-zero limit when there are infinitely many parties.