(Almost) efficient information transmission in elections

Renaud Foucart and Robert C. Schmidt

European Economic Review, 2019, vol. 119, issue C, 147-165

Abstract: We study a model in which two parties compete by announcing their policies, after receiving conditionally independent private signals about the true state of the world. Parties are both office- and policy-motivated. Our model can explain radically different policy positions, even when parties receive identical signals and have unbiased preferences. This holds in an asymmetric equilibrium in which both parties reveal their private information to the voters and the implemented policy is (almost) first-best for all possible realizations of parties’ signals. In this equilibrium, one party adopts extreme and the other one moderate policy positions.

Keywords: Electoral competition; Signaling; Intuitive criterion (search for similar items in EconPapers)
JEL-codes: D72 D83 Q54 (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:119:y:2019:i:c:p:147-165

DOI: 10.1016/j.euroecorev.2019.07.005

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