UE295 - Introduction to Political Economy (introduction à l'économie politique)

Intervenant·e·s

• Ekaterina Zhuravskaya [référent·e]   directrice d'études, EHESS / Paris School of Economics (PJSE)

En français: 

Ce cours d'économie politique de niveau master (M1) couvre une série de sujets liés aux systèmes politiques, à l'agence et au comportement électoral. Le cours commence par des modèles de base de la démocratie représentative qui intègrent l'engagement envers les promesses de campagne et le vainqueur de Condorcet. Il aborde ensuite la convergence politique sans vainqueur de Condorcet, à l'aide d'un modèle de vote probabiliste et d'un modèle de citoyen-candidat qui ne s'engage pas à respecter les promesses de campagne.

Le cours explore ensuite les effets de la réserve politique et l'importance des leaders. Il examine également le rôle de la limitation des mandats dans le contrôle de l'action politique et l'importance de l'information et de la surveillance pour prévenir les cycles politiques opportunistes.

Le cours aborde également le concept de rationalité de l'électeur et le paradoxe du vote. Il approfondit le thème de la redistribution et son rôle dans la politique économique, ainsi que l'économie politique des États autoritaires, des démocratisations et des renversements de tendance. En outre, le cours couvre l'économie politique de la construction des nations et la montée du populisme dans la politique moderne.

Dans l'ensemble, ce cours permet aux étudiants d'acquérir une compréhension globale de l'interaction entre la politique et l'économie, et des divers facteurs qui influencent le comportement et la prise de décision politiques.

In English:

This master's level (M1) course on political economy covers a range of topics related to political systems, agency, and voting behavior. The course begins with basic models of representative democracy that incorporate commitment to campaign promises and the Condorcet winner. It then moves on to discuss policy convergence without a Condorcet winner, using a probabilistic voting model and a citizen-candidate model that lacks commitment to campaign promises.

Next, the course explores the effects of political reservation and whether leaders matter. It also examines the role of term limits in controlling political agency and the importance of information and monitoring to prevent opportunistic political cycles.

The course also covers the concept of voter rationality and the voting paradox. It delves into the topic of redistribution and its role in economic policy, as well as the political economy of authoritarian states, democratizations, and reversals. Additionally, the course covers the political economy of nation-building and the rise of populism in modern politics.

Overall, this course provides students with a comprehensive understanding of the interplay between politics and economics, and the various factors that influence political behavior and decision-making.

level: M1, 24 hours

sessions: 12 sessions, 2 hours each

grading: midterm and final exam

Starred readings are compulsory!

Topic 1. A. What is political economy? B. Basic models of representative democracy with commitment to campaign promises and Condorcet winner

• Persson and Tabellini (2000) ch 1, 2, 3
• Husted, Thomas and Lawrence Kenny (1997). ‘The Effect of the Expansion of the Voting Franchise on the Size of Government”, Journal of Political Economy, 105(1), 54-81.
• Miller, Grant (2008). “Women’s Suffrage, Political Responsiveness, and Child Survival in American History”, Quarterly Journal of Economics, 123(3), 1287-1327.

Topic 2. Policy convergence without Condorcet winner: probabilistic voting model; No commitment to campaign promises, citizen-candidate model

• Chattopadhyay, Raghabendra and Esther Duflo (2004). “Women as Policy Makers: Evidence from a Randomized Policy Experiment in India,” Econometrica, 72(5), 1409-1443.
• Persson and Tabellini (2000) ch 3, 4, 5

 Topic 3: Effects of political reservation; do leaders matter?

• Pande, Rohini (2003). “Can Mandated Political Representation Increase Policy Influence for Disadvantaged Minorities? Theory and Evidence from India,” American Economic Review, 93(4), 1132-1151.
• Besley, Timothy, Olle Folke, Torsten Persson, Johanna Rickne (2017) "Gender Quotas and the Crisis of the Mediocre Man: Theory and Evidence from Sweden" AMERICAN ECONOMIC REVIEW, VOL. 107, NO. 8, AUGUST 2017. (pp. 2204-42)
• Besley, Timothy, [2005], “Political Selection” Journal of Economic Perspectives, 19(3), 43-60.Lee, David, and Enrico Moretti, and Matthew J. Butler (2004). “Do Voters Affect or Elect Policies? Evidence from the U.S. House,” Quarterly Journal of Economics, 119(3), 807-859.
• Jones, B. and B. Olken (2005), "Do leaders matter? National Leadership and Growth Since World War II," Quarterly Journal of Economics, 120(3) 835-864.
• Ferreira, F and J. Gyourko (2009), “Do political parties matter? Evidence from U.S. cities,” Quarterly Journal of Economics, 124 (1), 399-422.
• Pettersson-Lidbom, P. (2008), “Do parties matter for economic outcomes? A Regression-discontinuity approach,” Journal of the European Economic Association, 6 (5), 1037- 1056.
• Besley, Timothy. 2004. “Paying Politicians: Theory and Evidence.” Journal of the European Economic Association, 2:193–215.
• Caselli, Francesco, and Massimo Morelli. 2004. “Bad Politicians.” Journal of Public Economics, 88:759–782.

Topic 4: Political agency and failure of electoral control: term limits

• Shleifer, A.  and R. Vishny (1993), "Corruption" Quarterly Journal of Economics, August, 1993. 
• Shleifer, Andrei and Robert Vishny (1994). “Politicians and Firms”, Quarterly Journal of Economics, 109: 995-1026.
• Ferraz, Claudio and Frederico Finan (2011). “Electoral accountability and corruption: Evidence from the audit if local governments.” American Economic Review, American Economic Association, vol. 101(4), pages 1274-1311, June.
• Besley, Timothy, and Jose G.Montalvo 2011 “Do Educated Leaders Matter?” Economic Journal, 121, issue 554
• Besley, Timothy, Jose G.Montalvo, and Marta Reynal-Querol 2011 “Do Democracies Select More Educated Leaders?” American Political Science Review, 105, issue 03, p. 552-566.

Topic 5: Political agency and failure of electoral control: Information and monitoring

• Olken, Benjamin A. 2006. “Corruption and the Costs of Redistribution: Micro Evidence from Indonesia.” Journal of Public Economics 90(4-5):853–870.
• Olken, Benjamin A. 2007. “Monitoring Corruption: Evidence from a Field Experiment in Indonesia.” Journal of Political Economy 115:200–249.
• Bertrand, Marianne, Simeon Djankov, Rema Hanna and Sendhil Mullainathan. 2007. “Obtaining a Driver’s License in India: An Experimental Approach to Studying Corruption.” The Quarterly Journal of Economics 122(4):1639–1676.
• Ferraz, Claudio and Frederico Finan (2008). “Exposing Corrupt Politicians: The Effects of Brazil's Publicly Released Audits on Electoral Outcomes” The Quarterly Journal of Economics, Volume 123, Issue 2, May 2008, Pages 703–745.

Topic 6: Opportunistic political cycles

• Akhmedov, Akhmed, & Ekaterina Zhuravskaya, 2004. "Opportunistic Political Cycles: Test in A Young Democracy Setting," Quarterly Journal of Economics, MIT Press, vol. 119(4), pages 1301-1338, November. 
• Drazen, Allan “The Political Business Cycle after 25 Years” NBER Macroeconomics Annual , Vol. 15, (2000), pp. 75-117
• Shi, Min & Svensson, Jakob, 2006. "Political budget cycles: Do they differ across countries and why?," Journal of Public Economics, Elsevier, vol. 90(8-9), pages 1367-1389, September. 
• Johnson, Joseph M. & W. Mark Crain, 2004. "Effects of Term Limits on Fiscal Performance: Evidence from Democratic Nations," Public Choice, Springer, vol. 119(1_2), pages 73-90, 04.
• Mironov, M. and  Zhuravskaya, E. (2014) “Corruption in Procurement: Evidence from Financial Transactions Data” American Economic Journal: Economic Policy, vol. 8, no. 2, may 2016, (pp. 287-321).
• Pettersson-Lidbom, P. (2008), “Do parties matter for economic outcomes? A Regression-discontinuity approach,” Journal of the European Economic Association, 6 (5), 1037- 1056.
• Alesina, Alberto, and Gerald Cohen 1999. “Political Cycles and the Macroeconomy.” MIT press. Ch. 2,3,6.
• Alesina, Alberto, and Nouriel Roubini “Political Cycles in OECD Economies”  The Review of Economic Studies, Vol. 59, No. 4 (Oct., 1992), pp. 663-688

 Topic 7: Voter rationality and voting paradox

• Manacorda, Marco, Edward Miguel, and Andrea Vigorito. (2011). “Government Transfers and Political Support”, American Economic Journal: Applied Economics,, vol. 3(3), pages 1-28, July.
• Wolfers, Justin (2007). “Are Voters Rational? Evidence from Gubernatorial Elections”, unpublished working paper.
• Mullainathan, Sendhil and Ebonya Washington (2009). “Sticking with Your Vote: Cognitive Dissonance and Political Attitudes”, American Economic Journal: Applied Economics, 1(1), 86-111.
• Madestam A., and D. Yanagizawa-Drott  "Shaping the Nation: The Effect of Fourth of July on Political Preferences and Behavior in the United States," mimeo
• Coate, Stephen, Michael Conlin, and Andrea Moro (2008). “The performance of pivotal-voter models in small-scale elections: Evidence from Texas liquor referenda”, Journal of Public Economics, 92, 582–596.
• Gerber, Alan, Donald Green, and Christopher Larimer (2008). “Social Pressure and Voter Turnout: Evidence from a Large-Scale Field Experiment”, American Political Science Review, 102(1), 33-48.
• Washington, Ebonya (2006). “How Black Candidates Affect Voter Turnout”, Quarterly Journal of Economics, 121(3), 973-998.
• Gerber, A. and D. Green, “The Effect of Canvassing, Telephone Calls and Direct Mail on Voter Turnout: A Field Experiment,” American Journal of Political Science, 2000.
• Guiso and Pinotti "Democratization and Civic Capital " (2013) The Oxford Handbook of the Italian Economy Since Unification.

Topic 8: Redistribution

• Alesina, Alberto and George-Marios Angeletos, 2005, “Fairness and Redistribution: US versus Europe,” American Economic Review, 95(4), 960-980
• Alesina, Alberto & Rodrik, Dani, 1994. "Distributive Politics and Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 109(2), pages 465-90, May. 
• Acemoglu, D. and J. Robinson, “Inefficient Redistribution,” American Political Science Review, 2001.
• Coate, S. and S. Morris, “On the Form of Transfers to Special Interests,” Journal of Political Economy, 1995.
• Acemoglu, D., “Why not a Political Coase Theorem? Social Conflict, Commitment, and Politics,” Journal of Comparative Economics, 2003.
• Ansolabere, Figuerido and Snyder, 2003, “Why is there So little Money in US Politics”, Journal of Economic Perspectives, vol. 17, n.1, pp. 105-130.
• Singhal Monica, “Special Interest Groups and the Allocation of Public Funds”, Journal of Public Economics, Volume 92, Issues 3–4, April 2008, Pages 548–564

 Topic 9: Authoritarian states, democratizations, reversals

• Acemoglu Daron, Suresh Naidu, Pascual Restrepo, and James A. Robinson “Democracy Does Cause Growth,” Journal of Political Economy, forthcoming.
• Acemoglu, Daron And James A. Robinson, 2001, “A theory of political transitions”, American Economic Review, 91:4,  938-‐963.
• Torsten Persson and Guido Tabellini, Democracy and Development: The Devil in the Details
• Acemoglu Daron, Simon Johnson, James A. Robinson, Pierre Yared, "Reevaluating the modernization hypothesis." Journal of Monetary Economics, Volume 56, Issue 8, November 2009, Pages 1043-1058.
• Acemoglu, Daron, Simon Johnson, James Robinson, and Pierre Yared. (2008). “Income and Democracy”, American Economic Review, 98(3), 808-842
• Dal Bo, Pedro, Andrew Foster, Louis Putterman (2010) "Institutions and Behavior: Experimental Evidence on the Effects of Democracy", American Economic Review, 100(5), 2205-2229.
• Masayuki Kudamatsu, 2012. "Has Democratization Reduced Infant Mortality In Sub-Saharan Africa? Evidence From Micro Data," Journal of the European Economic Association, vol. 10(6), pages 1294-1317, December.
• Besley Timothy and Masayuki Kudamatsu (2008) "Making Autocracy Work" in Institutions and Economic Performance (edited by Elhanan Helpman, Harvard University Press), pp. 452-510.
• Barro, Robert, 1999, “Determinants of Democracy,” Journal of Political Economy, 107(6), S158-S183.
• Papaioannou, Elias and Gregorios Siourounis, 2007, “Initial Factors Behind the Third Wave of Democratization,” Journal of comparative economics, 2008
• Boix, Carles, and Susan C. Stokes “Endogenous Democratization” World Politics , Vol. 55, No. 4 (Jul., 2003), pp. 517-549
• Brückner Markus and Antonio Ciccone "Rain and the Democratic Window of Opportunity" Econometrica, Volume79, Issue3, May 2011, Pages 923-947
• Acemoglu and Robinson, Chapters 3, 6, and 9

Topic 10: Political Economy of Populism

• Sergei Guriev and Elias Papaioannou. "The Political Economy of Populism." Forthcoming, Journal of Economic Literature.
• Fetzer, Thiemo. 2019. \Did Austerity Cause Brexit?" American Economic Review 109 (11): 3849-86.
• Inglehart, Ronald, and Pippa Norris. 2017. “Trump and the Populist Authoritarian Parties: The Silent Revolution in Reverse." Perspectives on Politics 15 (2): 443-54. https://doi.org/10.1017/S1537592717000111.
• Giampaolo Bonomi, Nicola Gennaioli, and Guido Tabellini (2021) “Identity, Beliefs, and Political Conflict”.  The Quarterly Journal of Economics, Volume 136, Issue 4, November 2021, Pages 2371–2411, https://doi.org/10.1093/qje/qjab034

Topic 11: Political economy of nation building

• Dominic Rogner and Ekaterina Zhuravskaya Nation Building: Big Lessons from Successes and failures, CEPR e-book, 2023
• Chapter 1
• Chapters 2 through 26.