Wednesday, November 19, 2014

Losing to Win


Abstract: We study an infinite horizon model of political competition where parties face a trade-off between winning today and winning tomorrow. Parties choose between nominating moderates, who are more viable, or partisans, who can energize the base and draw in new voters which helps win future elections. Only moderates can win in equilibrium and so the winning party fails to invest in its base and has a weaker future. Hence the longer a party is in power the more likely they are to lose, a pattern that finds strong support in the data. This dynamic also creates an electoral cycle where parties regularly take turns in power.
The paper is here (pdf), Kai’s job market paper on Tiebout competition and minorities is here (pdf), it covers how mobility can lead to a race to the bottom when it comes to protecting the rights of minority workers.