Thinking About Something Else: A Rationality‐Compatible Mechanism with Macroscopic Consequences

Is Democracy Exportable?

Among many aspects to the question of whether democracy is exportable, this contribution focuses on the role of the people, understood not as a unitary actor but as a heterogeneous set: the citizens. The people matter, in a different way, both in the countries to which democracy might be exported and in the democratic countries in which the question is about promoting democracy elsewhere. The mechanisms or characteristics involved in the discussion include yardstick competition, differences among citizens in the intensity of their preferences, differences among autocracies regarding intrusion into private life, citizens’ assessments of future regime change, and responsiveness of elected inc…

Rational Foundations of Democratic Politics

1. Introduction Albert Breton, Gianluigi Galeotti, Pierre Salmon and Ronald Wintrobe Part I. Some Problems with Democratic Institutions and Trends in Their Evolution: 2. Demobilization, demoralization and the loosening bonds of electoral politics Michael C. Munger 3. Turning 'citizens' into 'consumers': economic growth and the level of public discourse Stergios Skaperdas 4. Economic and cultural prerequisites for democracy Roger D. Congleton 5. Civil society and the contemporary social order Frederique Chaumont-Chancelier Part II. Morals in Politics: 6. When does altruism overcome the intransitivity of income redistribution? Donald Wittman 7. Democratic resilience and the necessity of virtu…

France: Forces Shaping Centralization and Decentralization in Environmental Policymaking

This book examines how different countries define and address environmental issues, specifically in relation to intergovernmental relations: the creation of institutions, the assignment of powers, and the success of alternative solutions. It also investigates whether a systemic view of the environment has influenced the policy-making process. The broad perspective adopted includes a detailed analysis of seventeen countries in six continents by scholars from a range of disciplines – economics, political science, environmental science and law – thus producing novel material that moves away from the conventional treatment of decentralisation and the environment in economic literature.

Reformuler des prémisses fausses comme des propositions vraies dans un certain domaine?

Transfer of powers and reallocation of the social capital available to junior governments

The article starts from the assumption that the production of junior governments in sub-central jurisdictions such as the department of the region is related both to the powers or resources that they receive from the central government and to the social capital which is available to them. A model is proposed in which both elements are considered as factors o f production. The second being able to move only slowly across levels of jurisdiction, the central government is itself unable to transfer rapidly powers or resources from one level to another without running the risk of an efficiency loss of the whole which it would find unacceptable in terms of electoral support.

Constitutional rules and competitive politics: their effects on secessionism

Albert Breton and Pierre Salmon argue that the effects of constitutiona l rules depend on the nature of political competition and on some meta-rules that contain procedures regulating the application and the modification of constitutiona l rules. They outline two models of competition - electoral competition and compound government competition - and describe the nature of the transactions between the parties involved in the two corresponding settings. In both, the transactions are over constitutional rules and ordinary goods and services, all of which are arguments in the utility functions of citizens. To make the discussion more concrete, the paper focuses on the demand for political auton…

Models and mecanisms in economics : attempt to clarify their relationships

The article is an attempt to clarify the relationship between economic models and mechanisms. The latter refer to causal processes and interactions. What role do they play in models? One must distinguish between models as non-linguistic constructs and models in the more usual sense of formal systems of definitions and mathematical relations. Models in the second sense are interpreted as purporting to characterise or describe in part models in the first sense. Thus the fact that there is no explicit reference to process-based mechanisms in many formal models does not mean that these mechanisms do not play an essential role in the non-linguistic models that these formal models describe in an …

The Competitive State

Intergovernmental competition in the European Union

International audience

Reforms and decentralization: friends or foes

Systemic concerns about markets, capitalism and the role of the state in the economy are salient again. Relatively large-scale reforms of economic and social arrangements are seriously considered. Historical experience suggests that reforms of that kind are sometimes associated with important changes in institutional arrangements pertaining to political decentralization. To explore the relationship between economic reforms and decentralization, the paper argues that a reform has two dimensions. It is a process and it is a design. The organization of the paper is inspired by that distinction. For economists, it seems natural to reason in terms of design -- that is, to perceive reform as the …

Democratic governments, economic growth and income distribution

That in democracies more inequality leads to more redistribution is an implication of Allan Meltzer and Scott Richard's well-known model ( 1981).1 That, in turn, more redistribution leads to less growth is a generally accepted proposition. That "inequality is harmful for growth" (Persson and Tabellini, 1994) is thus the predictable result of the introduction of policy-making à la Meltzer and Richard into the theory of growth. The small literature in which such introduction has been attempted includes contributions by Alberto Alesina, Giuseppe Bertola, Roberto Perotti, Thomsten Persson, Dani Rodrik, Gilles Saint- Paul, Guido Tabellini and Thierry Verdier. Short surveys are provided by Perott…

Economic models and representation.

Checks and balances and international openness

In the course of a long digression within his famous inspection of Plato’s political philosophy, Karl Popper (1945: 121) argues that “the problem of politics” is the following: “How can we so organize political institutions that bad or incompetent rulers can be prevented from doing too much damage?” Popper’s answer is: “the theory of checks and balances”, which he defines as the striving to establish “institutional control of the rulers by balancing their powers against other powers” (122). From that general approach to “the problem of politics”, it follows that democracy is definitely not the rule of the majority, or the sovereignty of the people (a conception that entails various paradoxe…

External effects of domestic regulations: comparing internal and international barriers to trade

Abstract In a world in which barriers to trade at all levels—international and internal—are mostly a by-product of the implementation by governments of different regulatory policies to deal with “domestic” or “local” problems such as environmental degradation, health, and labor standards, the article purports to show how the mechanisms that are set in motion by the operation of competition among the governments inhabiting the different jurisdictional tiers of federal countries lead to outcomes that are different from those generated by the ‘agreed-upon’ rules that govern the relations of national governments with each other in matters of international trade.

Compliance in Decentralized Environmental Governance

Environmental policy, focusing on the control of pollution and on over-exploitation, easily overlooks the extensive range of interconnections between economic activities and natural systems. In this timely book, a number of specialists examine how crucial aspects of complex environmental problems and policy can be dealt with in decentralized governmental systems.

Comment: how can a country like Canada be inhospitable to an influence of yardstick competition on regulation?

Political Extremism and Rationality

Political extremism is widely considered to be the product of irrational behavior. Originally published in 2002, the distinguishing feature of this collection by well-known economists and political scientists from North America, Europe and Australia is to propose a variety of explanations which all insist on the rationality of extremism. Contributors use variants of this approach to shed light on subjects such as the conditions under which democratic parties take extremist positions, the relationship between extremism and conformism, the strategies adopted by revolutionary movements, and the reasons why extremism often leads to violence. The authors identify four core issues in the study of…

From the Open Society to The Calculus of Consent: a long journey

International audience

Unpopular policies and the theory of representative democracy

Their platforms reflect concern with enhancing the probability of being elected, but some candidates often, or all candidates occasionally, voluntarily adept stances that reduce that probability. Governments care about their popularity, but sometimes they choose, even before an election, to announce or implement policies that are unpopular. For most people, the phenomenon is no news and is not altogether a unhappy one. Deprecating words such as demagogy or "mob rule" and praising ones such as leadership or statesmanship express a deeply-rooted, widelyshared concern about the possibility that democratic politicians could be too subservient to public opinion.(...)

Réflexions sur la nature et le rôle des modèles en économie

The logic of pressure groups and the structure of the public sector

Decentralization and growth: what if the cross-jurisdiction approach had met a dead end?

International audience; The relationship between decentralization and economic growth is generally studied from a perspective stressing universal or quasi-universal regularities across jurisdictions. That approach has generated many insights but seems to reach its limits. The paper explains why it allows contrasting positions with regard to the benefits of decentralization even among proponents of free and competitive markets. And it seems from the empirical literature that no robust and economically significant cross-jurisdiction relation between decentralization and economic performance or growth, except perhaps their independence, has been found. The absence of a relation valid across ju…

Understanding Democracy: Economic and Political Perspectives

Democracy has moved to the centre of systemic reflections on political economy, gaining a position which used to be occupied by the debate about socialism and capitalism. Certitudes about democracy have been replaced by an awareness of the elusiveness and fluidity of democratic institutions and of the multiplicity of dimensions involved. This is a book which reflects this intellectual situation. It consists of a collection of essays by well-known economists and political scientists from both North America and Europe on the nature of democracy, on the conditions for democracy to be stable, and on the relationship between democracy and important economic issues such as the functioning of the …

From equilibrium to chaos and back : methodological evaluation of research of the majority rule

According to the canonical model situated at the heart of the " economic " - or, as the political scientists prefer to call it, rational-choice - theory of (democratic) politics, whenever the matter to be decided raises, or consists of, at least two distinct issues, it is generally impossible to reach a determinate decision by using the majority rule. This problem, referred to as that of disequilibrium, equilibrium instability, or even"chaos", was first underplayed and then deemed ominous to the point of seriously undermining the development prospects of the whole theory. However, more recently, the concern it was the source o f until the 1980s has given way to a state of renewed confidence…

How significant is yardstick competition among governments? Three reasons to dig deeper

22 pages; The significance of yardstick competition among governments is now confirmed with regard to fiscal variables. This is an important result but the significance of the mechanism must also be sought in a context broader than that of fiscal federalism and without limitation to relations and processes fully observable. Three points are made. Even in the case of governments trying to mimic each other over a single variable, additional variables are involved in an important way. Yardstick competition can be latent without being ineffective. Its major effect, then, is to set bounds to the choices that office-holders could think of making. Finally, the mechanism is a hidden albeit essentia…

L'apport informatif des rapports Doing Business est précieux mais attention aux effets pervers.

Don't Tell Us: The Demand for Secretive Behaviour

The matter studied here is how, and with what implications, people may decide that they do not want to be let into secrets that concern them. They could get the information at no cost but they refuse to know. The reasoning is framed in terms of principals and agents, with the principals assumed not to want to know the agents' secrets. For convenience, the context chosen for the exposition is mainly that of voters as principals and the government or the office-holders as agents. After some exploration of the motivations underlying the attitude of the principals, the paper focuses on the case when neither total secrecy nor total disclosure prevails. The demand for partial secrecy is analysed …

Extrémisme et monomanie

The paper defines an extremist as an individual whose ideal point in the issue space is extreme in some dimension, and a "monomaniac" (no derogatory connotation) as an individual for whom one issue is given more weight, has greater "salience", than the others. This difference in salience is reflected in the spatial theory of voting by indifference curves taking the form of ellipses. Using this theoretical framework, it is showed that monomaniacs, even though they are not necessarily also extremists, can easily be induced by extremist politicians to form or support extremist coalitions. This phenomenon can account for a number of the observed characteristics of extremist movements. It also h…

Choisir sa population pour gagner les élections ? Une études sur les municipales de 1953 à 1983

Based on a regression analysis of French demographic and electoral data, 1953-1983, three relations suggested by theory appear confirmed: big cities tend to vote more for the right when compared to their own population the population of their suburbs is large; the distribution of the population of the urban area between the central city and the suburbs depends very significantly on the relation between the city's surface and the whole area's population ; the mayors of the central cities objectively influence the development of the distribution of the whole area's population in a way that is favorable to their reelection.

Alterable electorates in the context of residential mobility

In some circumstances, politicians set about altering the composition of their electorate with a view to increasing their chances of being re-elected. A hypothesis along these lines is formulated in the context of local elections and residential mobility. Although the hypothesis is general, an assessment of its validity implies auxiliary assumptions related to a specific spatio-temporal context. That is done with reference to conditions prevailing in post-war French metropolitan areas. In the empirical part of the paper, some of the implications are submitted to tests on demographical and political data. On the basis of the tests, and although alternative explanations of the findings are po…

Serving God in a largely theocratic society: rivalry and cooperation between Church and King

Theocracy may be understood in different ways. The meaning mostly used is government by priesthood but we may call that “ecclesiocracy” or “hierocracy.” Here, theocracy will designate government according to God’s prescriptions and wishes—with the specification that the implementation or satisfaction of these prescriptions and wishes should be a public or political rather than a private affair and should involve some degree of coercion. The two meanings are different notably because, in the second, priests need not be the ones, or the only ones, who rule on God’s behalf.

Recension de William A. Niskanen, 'Policy Analysis and Public Choice'

International audience

Political Yardstick Competition and Corporate Governance in the European Union

http://www.dur.ac.uk/john.ashworth/EPCS/Papers_and_Authors.php; The question whether regulatory competition in the area of company law could take place in the European Union (EU) in a way similar to the form it takes in the United States (the Delaware phenomenon) is topical because of some recent judgments of the European Court of Justice (Centros) and documents and projects produced by the European Commission. That question is typically discussed, however, as if voters did not count and as if competition among governments was exclusively based on the mobility of firms across jurisdictions. But intergovernmental competition can also take the form of yardstick, or relative performance, compe…

Méthodologie économique

Are discriminatory procurement policies motivated by protectionism ?

When purchasing goods and services, governments often discriminate in favour of domestic suppliers. It is widely assumed that such behaviour is motivated by protectionism. Although this interpretation is sometimes valid, it is also puzzling. After reviewing some of the puzzles, the paper proposes an alternative explanation of preferential procurement based on the assumption that governmental buyers want to purchase goods and services at minimum cost, but must do this in a context in which, because of the presence of unverifiable services, contracts are necessarily incomplete. The paper argues that preferential purchasing can guarantee the efficient delivery of these unverifiable services.

Nationalism and Rationality

Decentralization as an incentive scheme

Recent changes have introduced more decentralization in a number of traditionally centralized countries.1 In the case of France, it is sometimes claimed that the 1982-1983 reform of subcentral government is of historical importance. Although the principles of that reform are not contested any more by the new majority elected in 1986, opinions still differ on a number of policy issues. Some of the issues are presented in this introductory section. But the main purpose of this paper is not to expose or discuss in detail the problems of decentralization in France. As argued in the second part of the introductory section, the theoretical framework in which the policy issues of decentralization …

Horizontal Competition Among Governments

Governments situated on the same level of a multi-level governmental system compete with each other as well as with those placed higher or lower. This paper is concerned with horizontal competition only. It discusses both competition based on the mobility of agents (individuals, business firms, or factors) and competition related to the circulation of information. With regard to the first kind, it focuses on the capacity that governments keep to decide their policies and compete in spite of the mobility of agents. Some attention is also given to the implications of some non-standard assumptions about the underlying political setup. The discussion of information-based competition includes th…

Elections ordinaires et aménagements constitutionnels

It is widely held that voting in the course of ordinary elections has no significant influence on the constitutional regime or order of a country. At least three powerful arguments are provided in support of that view. First, to claim that, at the same time as they play, players can change the rules is, to say the least, logically puzzling. A second argument refers to the motivations and possibilities of voters : voters, this argument says, are not really interested in constitutional issues and, even if they were, are particularly ill-equiped to understand their implications. The third argument rests on the observation of what obtains in practice : as a matter of fact, constitutional issues…

How can a country like Canada be inhospitable to an influence of yardstick competition on regulation?

Recension de Daniel Treisman, The Architecture of Government: Rethinking Political Decentralization

Public Choice, vol. 142(1-2);

Competition and Structure: The Political Economy of Collective Decisions

DECENTRALISATION AS AN INCENTIVE SCHEME

Recent changes have introduced more decentralization in a number of traditionally centralized countries.1 In the case of France, it is sometimes claimed that the 1982-1983 reform of subcentral government is of historical importance. Although the principles of that reform are not contested any more by the new majority elected in 1986, opinions still differ on a number of policy issues. Some of the issues are presented in this introductory section. But the main purpose of this paper is not to expose or discuss in detail the problems of decentralization in France. As argued in the second part of the introductory section, the theoretical framework in which the policy issues of decentralization …

Le problème du réalisme des hypothèses en économie politique

This is a version, slightly corrected in 2010 with regard to form, of a working paper produced in 1968. Its subject is the problem of the realism of assumptions in economics. It offers an interpretation of Milton Friedman's famous essay of 1953 in which, contrary to most discussions, Friedman's solution to the problem does make sense. Under that interpretation, Friedman does not assert that one should test the consequences of a theory but not its assumptions, that one can predict but not explain, or that individuals behave as if they were rational and firms as if they maximized profits. Such assertions do not make sense and ascribing them to Friedman makes criticism of his position much too…

Models, theories and arguments in economics

La réflexion sur la pensée économique se développe très rapidement. Y participent de nombreux économistes, mais aussi, phénomène nouveau, unnombre appréciable de philosophes. Je voudrais défendre ici une certaine conception de la recherche à mener dans ce qui est en train de devenir unespécialité ou un domaine aussi bien pour les économistes que pour les philosophes

L'actualité du traditionalisme en méthodologie

The Economics of Transparency in Politics

Introduction, p. 1-8

Acquiescence to opacity

Opacity may affect both the means used to implement policies and the real objectives that they pursue. Our concern with opacity is limited to the cases when it is the result of obfuscation. that is, of some effort on the part of governments or other public bodies (central banks or international organisations) to hide or misrepresent their choices. In the literature concerned with accounting for inefficient policies, there are now models in which opacity plays no significant role. This chapter provides a number of mechanisms that account for or lead to the phenomenon the authors are interested in, that is, voters preferring a policy to be opaque rather than transparent. It then discusses two…

Decentralization as an incentive scheme when regional differences are large

It has been suggested that large regional differences could be an obstacle to that part of the political accountability of office-holders which is based on yardstick competition among governments. The paper addresses that question and concludes that the obstacle is not too serious in general. The second part of the paper is devoted to the persistent economic underperformance of some regions in countries such as Germany, Italy and (with regard to regions overseas) France. How is it that the mechanism of yardstick competition induces a convergence of economic performance among European Union member countries, even those particularly poor initially, but fails to induce all the underperforming …

Epistémologie

Explaining Social Behavior: More Nuts and Bolts for the Social Sciences, Jon Elster. Cambridge University Press, 2007, xi + 484 pages.

Governing the economy of the European Union: what scope for new constitutional provisions?

Proceedings of the International Conference. Torino, November 22 and 23, 2002

Alterable electorates : a general hypothesis in the context of residential mobility and a test on french data

International audience

Horizontal competition in multilevel governmental settings

28 pages; Governments situated on the same level of a multi-level governmental system compete with each other as well as with governments placed higher or lower. This paper is concerned with horizontal competition only. It discusses both competition based on the mobility of agents and competition based on comparisons of performance across jurisdictions - i.e., yardstick competition. With regard to the first kind, the focus is on the capacity of governments and voters to decide policies in spite of the mobility of agents. Some attention is also given to non-standard mechanisms in which mobility is manipulated so as to change the structure of the electorate. The paper considers two forms of h…

La méthodologie de l'Economie Théorique et Appliquée aujourd'hui, ouvrage édité sous la direction de J. WOLFF avec P. SALMON, B. WALLISER, A. WOLFELSPERGER, Actes du Colloque de l'AFSE, Nathan, Paris, 1990, 192 pages.

International audience

Preferences and Democracy