SFB 303 Discussion Paper No. A - 556
Author: Artale, Angelo, and Hans Peter Grüner
Title: A Model of Stability and Persistence in a Democracy
Abstract: We develop an intertemporal model of political competition which
accounts for three stylized facts of political life in representative
democracies: (i) the absence of discriminination and excessively
cycling majorities (political stability), (ii) a limited degree of
political competition and (iii) the persistence of different political
outcomes in otherwise similar economies. Our analysis is founded on the
observation that political stability is desirable for risk-averse
voters. Rational voters should therefore coordinate and restrict policy
proposals to "decent" ones, i.e. to proposals which do not discriminate
against single groups in favor of the others. We interpret the voting
behavior of socio-economic groups as the cooperative solution of the
voting-dilemma and derive properties of the set of possible political
outcomes.
Keywords: democracy, political stability, political persistence
JEL-Classification-Number: C72, D70, D72
Creation-Date: July 1997
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