The Power of Parties

Jon Fiva, Olle Folke and Rune J. Sørensen

No 4119, CESifo Working Paper Series from CESifo

Abstract: As with the market for goods and services, democratic competition involves political parties offering their services (policy programs) to citizen-consumers who vote for their preferred partisan supplier. Little is known about the partial effect of a shift in parties’ seat shares for given voter preferences, particularly in proportional representation systems. We estimate party effects using a regression discontinuity design tailored to proportional systems. Based on rich local government data, the analyses show that parties matter for fiscal policies. A larger left-wing party leads to more property taxation and higher user charges. It also leads to higher spending on child care but less on old-age care. These effects are caused both by changes in the representation of individual parties and by shifts between the party blocs.

Keywords: fiscal policy; proportional representation; regression discontinuity design (search for similar items in EconPapers)
JEL-codes: C23 D72 H71 H72 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_4119

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