Rational ignorance and the public choice of redistribution

This paper studies the role of citizensÂ’ demand for political information in elections and provides a possible explanation for the poor empirical support encountered by political economy models of income redistribution. It shows that incentives to gather political information may derive from its relevance to private choices. Under quite mild assumptions, the demand for political information is increasing in income. Information affects citizensÂ’ responsiveness to electoral platforms, and vote-seeking political parties should take this into account: as a consequence, redistribution will generally be less than predicted by the median voter theorem. Moreover, in contrast with what most literature seems to take for granted, an increase in inequality will not unambigously increase redistribution. Finally, introducing endogenous information may lead some policy restrictions to have effects quite different from those intended.redistribution, median voter, information, inequality

Enfranchisement and Representation: Italy 1909-1913

This paper presents evidence on the consequences of the 1912 introduction of "quasiuniversal" male suffrage in Italy. The reform increased the electorate from slightly less than three million to 8,650,000 and left the electoral rules and the district boundaries unchanged. This allows us to exploit the heterogeneity in enfranchisement rates across electoral districts to identify the causal effects of franchise extension on a number of political outcomes. The reform caused an increase in the vote share of social reformers (Socialists, Republicans and Radicals), together referred to as the Estrema. One standard deviation in the share of newly enfranchised voters over the total number of registered 1913 voters caused an increase of around 2% in votes for Estrema candidates but had no impact on their parliamentary net seat gains. Enfranchisement had also no impact on the parliamentary representation of aristocracy and traditional elites. Other outcomes (the chances of having candidates from the Estrema and the Herfindel-Hirshman index of electoral competition) were also unaffected, with the exception of turnout, which decreased. These findings show that de jure political equalization did not cause major changes to political representation, although the voting choices of the formerly and newly enfranchised citizens differed on average. This apparent puzzle is the consequence of the heterogeneity of the effect across a number of both social and political dimensions. The paper documents elite's effort to minimize the political impact of the reform.democratization, voting, electoral competition, inequality, swingdistricts, political violence, Vatican, socialism.

The UK should embrace the European model of public financing for political parties

Valentino Larcinese argues that, as is the case in Europe, the UK should adopt public financing for political parties to help avoid elite capture by wealthy private individuals or corporations, and allow politicians to devote their time to activities other than just fundraising

Personal and household income taxation in a progressive tax system: evidence from Italy.

I compare personal and household income taxation and study the effects of tax progression under the two systems. Potential reforms of the Italian tax system are simulated, endogenizing labor supply reactions. Results show that, with respect to a number of indicators, the choice of the tax unit is more relevant than the degree of progression of the tax schedule. A personal and progressive tax system provides incentives to female labor supply and turns out to be the most effective in redistributing income and raising revenue, with little productive costs compared with a flat tax rate. Household taxation has instead a number of drawbacks when coupled with a progressive tax schedule.

PERSONAL AND HOUSEHOLD INCOME TAXATION IN A PROGRESSIVE TAX SYSTEM: EVIDENCE FROM ITALY

I compare personal and household income taxation and study the effects of tax progression under the two systems. Potential reforms of the Italian tax system are simulated, endogenizing labor supply reactions. Results show that, with respect to a number of indicators, the choice of the tax unit is more relevant than the degree of progression of the tax schedule. A personal and progressive tax system provides incentives to female labor supply and turns out to be the most effective in redistributing income and raising revenue, with little productive costs compared with a flat tax rate. Household taxation has instead a number of drawbacks when coupled with a progressive tax schedule.

The real problem in Italian democracy is not the electoral law, but Silvio Berlusconi’s continued grip over the country’s media

Italy’s new prime minister Matteo Renzi has made electoral reform one of his key priorities, with a new electoral law currently under consideration in the Italian Senate, having been passed in the lower house of the Italian parliament last week. Valentino Larcinese writes that while Renzi may succeed in his attempts at electoral reform, the fact that he has relied on the support of Silvio Berlusconi carries its own cost. By offering Berlusconi a route back into frontline politics, Renzi has effectively contributed to the former Italian PM’s political rehabilitation following his expulsion from parliament. Moreover, the preoccupation with electoral reform has obscured the fact that the foremost problem with Italian democracy still remains: Berlusconi’s grip over the country’s media

Do Small States Get More Federal Monies? Myth and Reality about the US Senate Malapportionment

We analyze the relationship between senate malapportionment and the allocation of the US federal budget to the states during the period 1978-2002. A substantial literature originating from the in�uential paper by Atlas et al. (1995), using a within estimation methodology �nds that small and overrepresented states get signi�cantly larger shares of federal funds. Revisiting the econometric speci�cation used by the current empiri- cal research, we show that the number of senators percapita is inappropriate to capture malapportionement in regressions using broad federal programs, and that the results ob- tained with this indicator are extremely non-robust to reasonable speci�cation changes. In particular, senators percapita have a signi�cant impact on federal spending only in re- gressions containing state �xed e¤ects. Furthermore, the coefficients estimated using the within methodology are statistically di¤erent across states and, therefore, cannot be used to assess spending differentials between states. The magnitude and signi�cance of those coe¢ cients suggest a within state-speci�c inverse relationship between broad spending categories and population which is not systematically related to the size of the states and seems more compatible with incrementalist theories of budget allocation.federal budget; malapportionment; small state advantage; overrepresentation

Why Italians should reject Renzi’s constitutional reform

We are now in the final month of campaigning ahead of Italy’s constitutional referendum on 4 December. Presenting a case for a No vote, Valentino Larcinese argues that the proposed reform would remove much needed checks and balances on executive power in Italy, while the method used by the government to try and enact the reform is also worthy of rejection in its own right

There is no such thing as the ‘will of the people’ – Brexit needs the involvement of parliament

Theresa May has rejected calls for the UK parliament to have a vote on the terms of Brexit, however on 12 October she accepted that there will be an opportunity for parliament to debate the country’s strategy before Article 50 is triggered. Valentino Larcinese states that the argument against parliament having a strong role in the process rests on a decidedly misguided notion of the ‘will of the people’ and that UK citizens deserve adequate deliberation and decision-making procedures to determine the way forward following the referendum result

Crime and punishment the British way: how the expenses scandal affected the 2010 general election

A study by Valentino Larcinese examines the channels through which voters keep politicians accountable. Using the expenses scandal as a source of data, he finds that it was scandal-related press coverage which affected negatively the 2010 performance of standing MPs. Punishment in the ballot box, however, was relatively small and generally not sufficient to remove MPs involved in the scandal from their seat. One of the reasons why in general elections the punishment of corrupt politicians can be modest is because ideology matters and many voters may still prefer a corrupt politician to an ideologically more distant alternative