Do the Right Thing. A Comparison of Politicians' Incentives Across Constitutional Systems

Abstract

Constitutional structures shape politicians' behaviour and hence policy outcomes through the dierent incentive schemes at work. In this paper we analyse these mechanisms in parliamentary and presidential systems. Such a comparison is carried over by analysing how the two systems are able to select the ecient policy in presence of asymmetric information. The constitutional structures dier in that the policy proposal in parliamentary democracies is observable and condence-dependent. The main ndings suggest that the parliament responds to the incentive scheme better in presidential systems due to less uncertainty that legislators face over their term limit. However, the parliamentary system induces the executive to behave more eciently due to selection and disciplining eects.

It's a Matter of Confidence: Institutions, Government Stability and Economic Outcomes

“…While recent works, such as Robinson and Torvik (2008) and Hayo and Voigt (2013), investigate the determinants of the choice or change of the constitutional structure, not much has been done to refine the classification of constitutional structures when studying their effect on policy. 3 In Section 2 we suggest how our findings may be explained by two effects that are consistent with previous theoretical literature: a selection effect, as in Cella et al (2015), and a legislative cohesion effect, as in Baron (1998), Feddersen (1998a, 1998b) and Diermeier and Vlaicu (2011). Section 3 presents the data and the model, Section 4 discusses the results and Section 5 concludes.…”

“…ously in presidential systems and generally gives rise to unique equilibria, parliamentary systems are more heterogeneous and can support multiple equilibrium strategies and induce multiple equilibrium outcomes (see for example Cella et al (2015)). For example, parliamentary systems outcomes may differ depending on whether the confidence vote is mostly used as a threat or whether it effectively replaces politicians.…”

“…11 Thus, gov lif e is the average length of any electoral cycle computed for each country i, normalized by the legal length of the electoral cycle. The index ranges from zero to one, with higher 6 Other possible dependent variables included in the PT dataset are central government expenditure on social services and welfare as a percentage of the GDP (ssw ), log of the output per worker (logyl ) and the perception of corruption (cpi). 7 The continental location variables are reported in Footnote 5.…”

“…In particular in a model such as in Cella et al (2015), the performance of parliamentary systems closely approaches the performance of presidential systems if the confidence vote entails a better ability of legislators to reject bad policy proposals and thus a more unstable political environment. However, if the selection effect is not effective then the de facto behaviour of politicians will be driven by political incentives.…”

It’s a matter of confidence. Institutions, government stability and economic outcomes

“…In Sect. 2 we suggest how our findings may be explained by two effects that are consistent with previous theoretical literature: a selection effect, as in Cella et al (2017), and a legislative cohesion effect, as in Baron (1998), Feddersen (1998a, 1998b) and Diermeier and Vlaicu (2011). Section 3 presents the data and the empirical strategy, Sect.…”