Voters’ commitment problem and reforms in welfare programs

David Hollanders and Barbara Vis ()

Public Choice, 2013, vol. 155, issue 3, 433-448

Abstract: When will a vote-seeking government pursue unpopular welfare reforms that are likely to cost it votes? Using a game-theoretical model, we show that a government enacts reforms that are unpopular with the median voter during bad economic times, but not during good ones. The key reason is that voters cannot commit to re-elect a government that does not reform during bad times. This voters’ commitment problem stems from economic voting, i.e., voters’ tendency to punish the government for a poorly performing economy. The voter commitment problem provides an explanation for the empirical puzzle that governments sometimes enact reforms that voters oppose. Copyright The Author(s) 2013

Keywords: Commitment; Political economy; Reform; Welfare-programs; D72; D78; H11; H5; I38; J48 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (2)

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DOI: 10.1007/s11127-011-9872-1

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