 Policy experimentation with repeated electionsIlwoo Hwang Games and Economic Behavior, 2023, vol. 142, issue C, 623-644 Abstract: When is an incumbent incentivized to experiment with risky reform policy in the presence of future elections? We study a dynamic game between two political parties with heterogeneous preferences and a voter. The voter elects a party that then chooses a policy from a status quo and two risky reform policies. Under infrequent elections, the incumbent party experiments with its preferred reform policy even if its outlook is not promising. In contrast, with overly frequent elections, the incumbent prematurely stops experimentation because an imminent election increases the danger of losing power. While infrequent elections are suboptimal, inefficiency from overly frequent elections is severe enough that voter is worse than under a dictatorship. We also show that the voter's ‘incumbent advantage’ behavior could lead to an efficient outcome in the frequent elections limit. Our results suggest that leaders engage in risky reform when the surrounding political environment allows them to fail. Keywords: Electoral accountability; Strategic experimentation; Political agency; Learning; Incumbency advantage (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:142:y:2023:i:c:p:623-644 DOI: 10.1016/j.geb.2023.09.006 Access Statistics for this article Games and Economic Behavior is currently edited by E. Kalai More articles in Games and Economic Behavior from Elsevier |
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