Competition in political and economic markets

Prepared as a response to Frey and Eichenberger's Anomalies in Political Economy. We thank Gordon Tullock for helpful discussions. This work was partially supported by the Taylor Experimental Laboratory at Washington University.     

Incentives and political contributions

Two implications from this research are noted. First, from a researcher's viewpoint, our research suggests the importance of age, wealth, tax rates, and marital status as determinants of political contributions by top U.S. wealth-holders. Therefore, these factors should be included in aggregated models that attempt to analyze the relations between such variables as voting, campaign expenditures and the outcomes of elections. Second, from politicians' viewpoints, this research suggests that individual economic variables such as marginal tax rates and wealth are major determinants of individual decisions to contribute to politicians. Assuming that such contributions reflect votes, this research suggests the relative importance of focusing campaign promises on economic variables — a strategy that low tax politicians like Ronald Reagan and George Bush may keenly be aware of.The views presented are those of the authors and do not necessarily represent those of the Treasury Department.     

The meaning of party labels

To determine the meaning(s) of the concepts Republican, Democrat, and Independent, the most frequently cited attributes of each party label were scaled in terms of their semantic centrality. An analysis of the magnitude scale values demonstrates that the labels Republican and Democrat have unique cognitive properties which easily discriminate one label from another. The most characteristic and discriminating properties refer to (1) voting, (2) electioneering, and (3) other forms of electoral behavior. Although these two labels have many strong properties over which there is considerable agreement, such consensus is lacking for the fewer and weaker properties which characterize and discriminate the label Independent. Whereas Republican and Democrat are sharply delineated, semantic inversions of one another, the concept Independent is ambiguously defined and only weakly distinguishable from other concepts.     

Public opinion and presidential responsibility for the economy: Understanding personalization

The general mechanisms which underlie the psychological phenomenon ofpersonalizing (cognitive simplification and defensive attribution) would seem to have great utility in explaining attributions of presidential control over the economy. Yet previous research has generated inconsistent and inconclusive empirical results. This study identifies several sources of inconsistency and then attempts to clarify the approach by focusing separately on the object and the subject of personalizing. Our findings suggest that the determinants of personalizing to the president are different from the factors that explain personalizing to the incumbent. In addition, we find that the impact of the two psychological mechanisms differs substantially within economic subject areas.Paper prepared for delivery at the 1984 Annual Meeting of the Southwestern Political Science Association, Fort Worth, Texas.     

The median and the competitive equilibrium in one dimension

Two alternative models of legislative outcomes are the minimum winning coalition and the competitive equilibrium (Koford, 1982). In a unidimensional setting, the outcome under the former is the median, while the outcome under the latter is the highest net demand location.This paper describes the competitive equilibrium in a unidimensional model, and shows that under some common conditions it coincides with the median, in particular for pure redistributive issues. However, for distributive issues, the two equilibria will differ. Finally, the comparative statics of the two models are examined; while the winning coalition is sensitive only to changes in the location of the median, for distributive issues the competitive equilibrium has the standard economic comparative statics that the outcome adjusts in the direction of the change in preferences.     

Tollison costs and technological innovation: The case of environmental regulation

This paper departs from the Tullock cost paradigm that views competition for monopoly privilege as a welfare-inimical process that wastefully dissipates preexisting producers' surplus and, occasionally, leads to inefficient increases in costs and counterproductive uses of scarce resources. The potential availability of rent-seeking may bring about the elimination of inefficient regulatory regimes that retard or prevent the introduction of cost-reducing innovations. Air quality management is but one area in which innovation rent-seeking holds promise for concrete welfare gains. Researchers may wish to focus on institutional mechanisms designed to overcome the transactions costs and free rider disincentives to the formation of a coalition to seek innovation rents. An example of such a mechanism might be a joint venture that requires all venture members to engage in lobbying and to contribute to collective research efforts. These unaddressed questions await future research.The authors are grateful for the insightful comments of Gordon Tullock, Robert D. Tollison, Michael T. Marlow and J.R. Clark. The usual caveats apply. The views expressed herein are solely those of the authors and should not be taken to represent the views of their employers.     

The possibility of a desirable minimal state

There is a near consensus that organized special interests use influence to expand government into activities that are detrimental to the public at large. Consequently, as Lee (1989) suggests, it would be desirable if the general public had more control over political decisions — if government were more responsive to the public interest. However, the public interest like rent-seeking, is a subjective concept (Pasour, 1987).The possible existence of a desirable minimal state is not disproved by an approach that assumes utilities are interpersonally comparable. Individual utilities are subjective and ordinal and hence, cannot be added or weighted to determine the level of government that is socially optimal. If one accepts the subjectivist approach, it follows that no one can decide upon any policy whatever in the absence of an ultimate ethical or value judgment (Rothbard, 1982: 212). In this respect, determining the desirable minimal state is no different from determining whether an individual government program is desirable (or whether it represents rent-seeking waste).     

Political arenas,life styles,and the impact of technologies on policymaking

Public policies are often founded upon or employ specific technologies. Two basic types of technology are distinguished—behavioral and physical technologies—and their contributions to policy and policymaking are discussed. The attractiveness of a technology to policymakers depends on how politically significant groups view the technology's impact on life styles and its implications for the allocation of values. Following Theodore Lowi's groundwork, behavioral technologies generally are perceived to redistribute values (power, respect, wealth, status) and regulate styles of living, while physical technologies generally appear to distribute values, opportunities, and freedom to pursue desired life styles. The policy sciences are given separate treatment as a behavioral technology with both distributive and redistributive aspects. The creative use of physical technology, development of multidisciplinary policy studies, and efforts towards more distributive behavioral technologies are discussed as more relevant and productive for policymaking.     

Policymaking and technology transfer: The need for national thinking laboratories

The objectives of this paper are to understand what is meant by better policymaking and more efficient technology transfer, to explore what is needed for their achievement, and to suggest an operational mechanism for improving the two processes.The author introduces a few new terms: (1) Inter-context information is defined, and its importance in decisionmaking, policymaking, technology transfer and education is pointed out; (2) a distinction is drawn between incidental technology transfer—initiated by the donor—and organized technology transfer—initiated by the recipient.The author suggests that National Thinking Laboratories should be established to promote organized technology transfer and to act as catalysts to organized policymaking. Their charter should be to match needs in one context to capabilities in another context. This charter is outlined in operational terms by five general objectives listed by the author. The National Thinking Laboratories are most urgently needed, particularly in the developing countries.     

International trade policy in Israel: Another model — Reply

The aim of this study was to examine the tariff structure in Israel in terms of the four main theoretical models of endogenous commercial policy. The empirical results for levels of protection in Israel support several of the models. In particular the pressure group model performs well and especially the variable that represents the lobbying power of the Histadrut/public sector in Israel. This is consistent with the longstanding political power of the Histadrut in Israel. The Histadrut's role in the Israeli economy rises above the western concept of a labor union and takes on a quasi-governmental function. The clearest example of this elevated status is seen when the government included the Histadrut as part of the commission charged with the responsibility of carrying out the nominal liberalization process of the 1960s. Evidently it is this kind of political-economic power that allowed the Histadrut to affect the level of protection Histadrut-dominated industries received.The displacement costs model is also supported suggesting that officials, when deciding on tariff rates, are sensitive to the displacement costs (e.g., amount and average duration of unemployment), associated with different levels of protection for various industries. This result stands in contrast to the goals set out in the New Economics Policy of 1962 discussed earlier. Apparently tariff setting authorities desired to increase efficiency by reducing protection but were also willing, perhaps for political reasons, to trade off lower displacement costs with higher tariff rates.     

Policy termination as a political process

The problem of how to terminate ineffective or outdated public policies, programs, or organizations is increasingly important. This paper argues that it is helpful to conceive of termination as a special case of the policy adoption process: there is a struggle to adopt a policy A, the substance of which is to eliminate or curtail policy B. The main distinguishing feature of this class of policy contests is the activity of vested interests who are able to advance a peculiarly powerful moral claim concerning the inequity or unfairness of change.     

Dilemmas in a general theory of planning

The search for scientific bases for confronting problems of social policy is bound to fail, becuase of the nature of these problems. They are wicked problems, whereas science has developed to deal with tame problems. Policy problems cannot be definitively described. Moreover, in a pluralistic society there is nothing like the undisputable public good; there is no objective definition of equity; policies that respond to social problems cannot be meaningfully correct or false; and it makes no sense to talk about optimal solutions to social problems unless severe qualifications are imposed first. Even worse, there are no solutions in the sense of definitive and objective answers.This is a modification of a paper presented to the Panel on Policy Sciences, American Association for the Advancement of Science, Boston, December 1969.     

Characteristics of migrants within the framework of current migration direction in the United States: Some evidence from micro-data analysis

In recent years, there has been growing interest in the phenomenon of an apparent population distribution reversal in the United States. This paper examines the characteristics of migrants participating in such moves between 1969 and 1977, based on data from a longitudinal nationwide household sample survey conducted by the University of Michigan. The data show that the amount of ruralward migration outweighs that of urbanward migration. While the ruralward migration was particularly prevalent in the Northeast, the direction of migration in the South was predominantly urbanward. Ruralward migrants appeared to be young single people and young married people without children, as well as stable families. The most ruralward migrants tended to be from the most highly urban environments. This new pattern of migration is independent of both white suburban flight and the sun-belt phenomenon. The findings suggest an important societal reorganization towards a newer post-industrial and less urban population distribution.     

Psychodynamics,symbolism, and socialization: “object relations” perspectives on personality,ideology, and political perception

Psychodynamic aspects of the perceptual process by which individuals relate to the distal symbolism of the political environment are explored through a conjunction of object relations theory and intensive analysis methodology. Drawing upon the joint theoretical perspective that object relations theory and the transference postulate bring to bear on personality and perception, a psychodynamic account of the attributional interface that exists between political symbols aspublic objects, on the one hand, andprivate symbolic meanings, on the other, is advanced and the dynamics at play demonstrated through detailed consideration of selected specimen cases. The individual dynamics demonstrated in each of the cases were found to obtain as well in the cases of others holding similar political views; moreover, certain of these group-wide personality patterns were discovered to have predictive significance in distinguishing radical ideologues from individuals subscribing to more moderate political views. Finally, the implications for a psychodynamic theory of political perception and socialization are considered.A revised and abbreviated version of a paper presented before the panel on Intensive Analysis in Political Psychology at the annual meeting of the Midwest Political Science Association, Chicago, April 20–22, 1978, under the title, Personality, Perception, and Political Ideology: Psychodynamic Aspects of Political Socialization and Symbolism.     

Policy: Constructing a definition

If policies are to serve as guides to real world actions and be subject to criticism and improvement out of human experience, they must have certain attributes and capacities - those requirements serve to define the meaning of the term. This article seeks (a) to demonstrate the substance of those requirements through a systematic analysis of the structures and processes involved in reasoned, corrigible actions, (b) to sketch the basic assumptions of a theory of knowledge able to show how those requirements can be fulfilled within the limits of human capacity, and (c) to examine the implications of that conception of policy, and its companion concept theory, for those involved in collective policymaking and policy studies.     

Single-issue voting: Elite-mass linkages

In this paper we consider the abortion and E.R.A. issues as examples of single-issue politics, as well as the nature of single-issue politics in general. We argue that many single issues are what others have called easy issues but that hard-issue voting as well as easy-issue voting may be occurring on both issues. We test this hypothesis using both mass and elite data sets. Our findings suggest that political activists may be cuing the masses into a pattern of single-issue voting, and hence keeping the battle over abortion and the E.R.A. intense.An earlier version of this paper was presented at the 1981 Annual Meeting of the American Political Science Association, New York, September 3–6, 1981.     

A second best mechanism for marketing emissions reductions

The purpose of this paper is to present a strategy for pollution control, representing a hybrid of conventional emission fees and standards approaches, which is designed to meet the dual needs of many localities for sustained industrial growth and compliance with air quality standards. We evaluate several second best policy mechanisms and extend our focus from questions of relative efficiency loss to concerns for feasibility, compliance incentives, and local objectives. For each non-attainment area, we suggest that a Clean Air Management Unit (CAMU) be established to formalize and oversee markets in emissions reductions.This work was supported by the Office of Environmental Affairs, City of New Orleans. The City Administration assumes no liability for the accuracy, completeness, or usefulness of this information.     

Crime,punishment and human nature

In Thinking About Crime James Q. Wilson brings a new dimension to crime policy research by explicating the failure of criminologists to adequately consider the philosophical perspectives on man and society which underlie alternate policy options. As a result, they rarely appreciate the inherent limits on government efforts to deal with crime. Wilson's consideration of these limitations, together with a critique of causal analysis in criminological thinking, lead him to propose an alternate conceptual framework, policy analysis. Our inspection of Wilson's own thinking reveals, however, that policy analysis is no less problematic and shortsighted than causal analysis, a result we attribute to serious flaws in his critique of criminological thinking and to the incorporation of his own biases about human nature into his conceptual framework. We seek in the concluding section to remove this bias and to demonstrate how policy analysis may be expanded into a more flexible, multi-dimensional framework, one which accounts for different assumptions about human nature and different policy goals.     

Defining “images” of presidential candidates from televised political spot advertisements

The proliferation in the use of televised political spot advertisements by presidential candidates justifies the increasing attention given to assess their value for the political system. Some controversy surrounding the value of their content concerns their reliance on image material. Yet the concept of candidate images has been ambiguous since images can refer to either graphic display of candidates or to candidates' character attributes. This study assesses candidates' character attributes in televised political commercials for 1980's American presidential primaries and finds that political spots offer useful and accurate profiles of candidates in campaigns and are helpful sources for the electorate to use in weighing the various strengths and weaknesses of presidential hopefuls.     

Impersonal influence: Effects of representations of public opinion on political attitudes

Many phenomena of interest to political scientists involve what may be termed impersonal influence; that is, influence that derives from individuals' perceptions of others' attitudes, beliefs, or experiences. Others in this case refers not to the close friends and acquaintances that concerned the authors of classics such asThe People's Choice andPersonal Influence, but rather to the anonymous others outside an individual's realm of personal contacts. Modern mass media facilitate the influence of anonymous others by devoting considerable time and attention to portraying trends in mass opinion. This study explores the rationale for theories of impersonal influence, synthesizing existing research findings falling under this general theoretical framework, and investigating its psychological underpinnings using experiments embedded in representative surveys.