The political economics of Wackersdorf: Why do politicians stick to their past decisions?

The politicians' reactions to changing circumstances appear often sluggish. The decisions about the construction of a nuclear reprocessing plant at Wackersdorf (Federal Republic of Germany) provide a recent example. Reprivatization of the company led to an immediate cancellation of the project due to its lack of economics. However, politicians tried (and still try) to save the project, despite a large public opposition. This may be considered as irrational because the politicians apparently account for their past investments. This paper argues that a piecemeal type of a policy is rational if voters honour both credibility and populistic decisions.I acknowledge the helpful comments from an anonymous referee and the suggestions from Elisabeth Szirucsek.