Dealing with the system
The Effects of Firms' Lobbying on Resource Misallocation
Federico Huneeus & In Song Kim
MIT Working Paper, November 2018
Abstract:
We study the causal effect of firms' lobbying activities on the misallocation of resources through the distortion of firm size. To address the endogeneity between firms' lobbying expenditure and their size, we propose a new instrument. Specifically, we measure firms' political connections based on the geographic proximity between their headquarter locations and politicians' districts in the U.S., and trace the value of these networks over time by exploiting politicians' assignment to congressional committees. We find that a 10 percent increase in lobbying expenditure leads to a 3 percent gain in revenue. To investigate the macroeconomic consequences of these effects, we develop a heterogeneous firm-level model with endogenous lobbying. Using a novel dataset that we construct, we document new stylized facts about lobbying behavior and use them, including the one from the instrument, to estimate the model. Our counterfactual analysis shows that the return to firms' lobbying activities amounts to a 22 percent decrease in aggregate productivity in the U.S.
Legislative Staff and Representation in Congress
Alexander Hertel-Fernandez, Matto Mildenberger & Leah Stokes
American Political Science Review, forthcoming
Abstract:
Legislative staff link Members of Congress and their constituents, theoretically facilitating democratic representation. Yet, little research has examined whether Congressional staff actually recognize the preferences of their Members' constituents. Using an original survey of senior US Congressional staffers, we show that staff systematically mis-estimate constituent opinions. We then evaluate the sources of these misperceptions, using observational analyses and two survey experiments. Staffers who rely more heavily on conservative and business interest groups for policy information have more skewed perceptions of constituent opinion. Egocentric biases also shape staff perceptions. Our findings complicate assumptions that Congress represents constituent opinion, and help to explain why Congress often appears so unresponsive to ordinary citizens. We conclude that scholars should focus more closely on legislative aides as key actors in the policymaking process, both in the United States and across other advanced democracies.
Influencing Connected Legislators
Marco Battaglini & Eleonora Patacchini
Journal of Political Economy, December 2018, Pages 2277-2322
Abstract:
This paper studies how interest groups allocate campaign contributions when congressmen are connected by social ties. We establish conditions for the existence of a unique Nash equilibrium in pure strategies for the contribution game and characterize the associated allocation of the interest groups' moneys. While the allocations are generally complex functions of the environment (the voting function, the legislators' preferences, and the social network topology), they are simple, monotonically increasing functions of the respective legislators' Katz-Bonacich centralities. Using data on the 109th-113th Congresses and on congressmen's alumni connections, we estimate the model and find evidence supporting its predictions.
Historic sex-ratio imbalances predict female participation in the market for politicians
Iris Grant et al.
Journal of Economic Behavior & Organization, forthcoming
Abstract:
We analyze the long-term effects of gender imbalances on female labor force participation, in particular in the market for politicians. We exploit variation in sex ratios - the number of men divided by the number of women in a region - across Germany induced by WWII. In the 1990 elections, women were more likely to run for office in constituencies that had relatively fewer men in 1946. We do not find a significant effect of the sex ratio on the likelihood of a woman winning the election. These results suggest that while women were more likely to run for a seat in parliament in constituencies with lower historical sex ratios, voters were not more inclined to vote for them. Voter demand effects thus do not appear to be as strong as candidate supply effects.
When Political Mega-Donors Join Forces: How the Koch Network and the Democracy Alliance Influence Organized U.S. Politics on the Right and Left
Alexander Hertel-Fernandez, Theda Skocpol & Jason Sclar
Studies in American Political Development, forthcoming
Abstract:
As economic inequalities have skyrocketed in the United States, scholars have started paying more attention to the individual political activities of billionaires and multimillionaires. Useful as such work may be, it misses an important aspect of plutocratic influence: the sustained efforts of organized groups and networks of political mega-donors, who work together over many years between as well as during elections to reshape politics. Our work contributes to this new direction by focusing on two formally organized consortia of wealthy donors that have recently evolved into highly consequential forces in U.S. politics. We develop this concept and illustrate the importance of organized donor consortia by presenting original data and analyses of the right-wing Koch seminars (from 2003 to the present) and the progressive left-leaning Democracy Alliance (from 2005 to the present). We describe the evolution, memberships, and organizational routines of these two wealthy donor collectives, and explore the ways in which each has sought to reconfigure and bolster kindred arrays of think tanks, advocacy groups, and constituency efforts operating at the edges of America's two major political parties in a period of intensifying ideological polarization and growing conflict over the role of government in addressing rising economic inequality. Our analysis argues that the rules and organizational characteristics of donor consortia shape their resource allocations and impact, above and beyond the individual characteristics of their wealthy members.
Elites in social networks: An axiomatic approach to power balance and Price's square root law
Chen Avin et al.
PLoS ONE, October 2018
Abstract:
A common two-tier structure for social networks is based on partitioning society into two parts, referred to as the elite and the periphery, where the "elite" is the relatively small but well-connected and highly influential group of powerful individuals around which the society is centered, and the "periphery" consists of the rest of society. It is observed that the relative sizes of economic and social elites in various societies appear to be continually declining. One possible explanation is that this is a natural social phenomenon, resembling Price's "square root" law for the fraction of good scientists in the scientific community. We try to assess the validity of this explanation by studying the elite-periphery structure via introducing a novel axiom-based model for representing and measuring the influence between the elite and the periphery. The model is accompanied by a set of axioms that capture the elite's dominance, robustness and density, as well as a compactness property. Relying on the model and the accompanying axioms, we are able to draw a number of insightful conclusions about the elite-periphery structure. In particular, we show that in social networks that respect our axioms, the size of a compact elite is sublinear in the network size. This agrees with Price's principle but appears to contradict the common belief that the elite size tends to a linear fraction of society (recently claimed to be around 1%). We propose a natural method to create partitions with nice properties, based on the key observation that an elite-periphery partition is at what we call a 'balance point', where the elite and the periphery maintain a balance of powers. Our method is based on setting the elite to be the k most influential nodes in the network and suggest the balance point as a tool for choosing k and therefore the size of the elite. When using nodes degrees to order the nodes, the resulting k-rich club at the balance point is the elite of a partition we refer to as the balanced edge-based partition. We accompany these findings with an empirical study on 32 real-world social networks, which provides evidence that balanced edge-based partitions which satisfying our axioms commonly exist.
Getting past the gender gap in political ambition
Jennifer Pate & Richard Fox
Journal of Economic Behavior & Organization, forthcoming
Abstract:
Women's under-representation in politics is an empirical fact. The U.S. ranks 102nd in the world in the percentage of women serving in the national legislature. A leading explanation is the persistence of a substantial gender gap in political ambition. Research explaining the gender gap in political ambition has focused primarily on factors such as self-assessed qualifications, risk aversion, and competitiveness. We make two advances on the existing literature: first, we examine the extent of the gender gap in political ambition using a discrete elicitation measure that provides a more precise measurement of the degree to which women and men exhibit electoral aversion. Second, we test three recruitment appeals - a leadership message, community service message, and qualifications message - to determine which type of appeal could reduce or eliminate the gender gap in political ambition. Our results, based on a laboratory experiment, confirm that women are less interested than men in standing for elective office. However, we also find that while women are less willing to enter an election, women are not unwilling to run for election. We conclude that women's lack of interest is not as definitive as prior research may have suggested. In terms of recruitment, all three messages significantly boost women's willingness to run in the election. Notably, though, the message describing running for office as a collective endeavor to help serve the community actually reduces men's willingness to enter the election, closing the gap in ambition.
Their Boot in Our Face No Longer? Administrative Sectionalism and Resistance to Federal Authority in the U.S. South
Nicholas Napolio & Jordan Carr Peterson
State Politics & Policy Quarterly, forthcoming
Abstract:
What explains state agency resistance to actions taken by their federal counterparts? And do sectional tensions make state bureaucratic nonacquiescence particularly likely in the U.S. South? We theorize that state resistance to federal administrative policy is more likely among Southern state bureaus due to administrative sectionalism. We argue that state agencies can and do resist federal administrative orders independent of other political constraints. This study is among the first to consider the policy consequences of sectionalism in state bureaucracies. We test our claims by employing a mixed methods approach that analyzes each instance of litigation and intervention by state bureaucrats in opposition to actions and orders by the Federal Energy Regulatory Commission (FERC) from 2010 to 2017. We find that, all else equal, state agency resistance to federal utility policy is about 3.75 times as likely among Southern utility regulators. This research has important normative implications for administrative politics as it suggests agencies with putatively apolitical policy jurisdiction have political preferences driven by sectional tension.
Text as Policy: Measuring Policy Similarity through Bill Text Reuse
Fridolin Linder et al.
Policy Studies Journal, forthcoming
Abstract:
The identification of substantively similar policy proposals in legislation is important to scholars of public policy and legislative politics. Manual approaches are prohibitively costly in constructing datasets that accurately represent policymaking across policy domains, jurisdictions, or time. We propose the use of an algorithm that identifies similar sequences of text (i.e., text reuse), applied to legislative text, to measure the similarity of the policy proposals advanced by two bills. We study bills from U.S. state legislatures. We present three ground truth tests, applied to a corpus of 500,000 bills. First, we show that bills introduced by ideologically similar sponsors exhibit a high degree of text reuse, that bills classified by the National Conference of State Legislatures as covering the same policies exhibit a high degree of text reuse, and that rates of text reuse between states correlate with policy diffusion network ties between states. In an empirical application of our similarity measure, we find that Republican state legislators introduce legislation that is more similar to legislation introduced by Republicans in other states, than is legislation introduced by Democratic state legislators to legislation introduced by Democrats in other states.
Too good to be truthful: Why competent advisers are fired
Christoph Schottmuller
University of Cologne Working Paper, September 2018
Abstract:
A decision maker repeatedly asks an adviser for advice. The adviser is either competent or incompetent and knows his type privately. His preferences are not perfectly aligned with the decision maker's preferences. Over time, the decision maker learns about the adviser's type and fires him if he is likely to be incompetent. If the adviser's reputation for being competent improves, he is less likely to be fired for incompetence but this makes pushing his own agenda more attractive to him. Consequently, very competent advisers are also fired with positive probability because they are tempted to pursue their own goals. The quality of advice can be highest if the adviser's competence is uncertain.
Legislators as Lobbyists
Melinda Ritchie & Hye Young You
Legislative Studies Quarterly, forthcoming
Abstract:
Public policy is produced by elected and unelected officials and through the interactions of branches of government. We consider how such interactions affect policy implementation and representation. We argue that legislators try to influence bureaucratic decisions through direct communication with federal agencies, and that such contact is effective and has consequences for policy outcomes. We provide empirical evidence of this argument using original data about direct communication between members of Congress and the U.S. Department of Labor (DOL) along with decisions made by the DOL regarding trade and redistributive policies. We find that direct contacts influence DOL decisions, and the agency is more likely to reverse previous decisions when requested to do so by legislators. Our results challenge key assumptions and findings in the previous literature and have important implications for interbranch relations and informal means of control over the implementation of national policy.
Married Women's Economic Rights Reform in State Legislatures and Courts, 1839-1920
Sara Chatfield
Studies in American Political Development, forthcoming
Abstract:
Beginning in 1839 and continuing through the early twentieth century, the American states passed laws expanding married women's economic rights, including the right to own property and sign contracts. In almost every state, these significant legal changes took place before women had the right to vote. I argue that married women's economic rights reform is best understood as a piecemeal, iterative process in which multiple state-level institutions interacted over time. This rights expansion often occurred as a by-product of male political actors pursuing issues largely unrelated to gender - such as debt relief and commercial development - combined with paternalistic views of women as needing protection from the state. State courts played a crucial role by making evident the contradictions inherent in vague and inconsistent legal reforms. Ultimately, male political actors liberalized married women's economic rights to the extent that they thought it was necessary to allow for the development of efficient and workable property rights in a commercial economy, leaving women's place in the economy partially but not fully liberalized.