Yardstick competition: a spatial voting model approach

Emanuele Canegrati

MPRA Paper from University Library of Munich, Germany

Abstract: I analyse a yardstick competition game using a spatial voting model, where voters vote for a candidate according to the distance between their Ideal Point and the policy selected by a candidate. The policy which is closest to a voter’s IP provides the voter with a higher utility so that minimizing the distance means maximising the utility. I demonstrate that in the presence of asymmetrical information the existence of yardstick competition entails a selection device but not a discipline device, suggesting the existence of a trade off between these two goals. In the second part, I analyse an economic environment characterised by the presence of shocks, whose sign and magnitude are private information of incumbents. This time, the introduction of yardstick competition acts both as a selection and a discipline device.

JEL-codes: D72 H73 I38 (search for similar items in EconPapers)
Date: 2006-04
New Economics Papers: this item is included in nep-cdm, nep-pbe and nep-pol
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:1017

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