Faculty of Economics and Business Administration Publications Database

Political selection and the optimal concentration of political power

Authors:
Hansen, Emanuel
Pönitzsch, Gert
Source:
ISSN-Print: 0938-2259
Link External Source: Online Version
Year: 2019
Keywords: Elections; Constitutional design; Selection; Asymmetric information
Abstract:

We study how policy choice and political selection are affected by the concentration of political power. In a setting with inefficient policy gambles, variations in power concentration give rise to a trade-off. On the one hand, power-concentrating institutions allocate more power to the voters’ preferred candidate. On the other hand, they induce the adoption of more overly risky policies and decrease the voters’ capability to select well-suited politicians. We show that full concentration of power is optimal if and only if the conflict of interest between voters and politicians is small. Otherwise, an intermediate level of power concentration is optimal.

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