This paper investigates the impact of emigration on the political choice regarding the size of the welfare state. Mobility has two countervailing effects: the political participation effect and the tax base effect. With emigration, the composition of the constituency changes. This increases the...

We study a simple model of commuting subsidies with two transport modes. City residents choose where to live and which mode to use. When all land is owned by city residents, one group gains from subsidies what the other loses. With absentee landownership, city residents as a group gain at the...

This paper presents a tractable dynamic general equilibrium model that can explain cross-country empirical regularities in geographical mobility, unemployment and labor market institutions. Rational agents vote over unemployment insurance (UI), taking the dynamic distortionary e.ects of...

We study the political economy of commuting subsidies in a model of a mono-centric city with two income classes. Depending on housing demand and transport costs, either the rich or the poor live in the central city and the other group in the suburbs. Commuting subsidies increase the net income...

At borders where rich and poor countries meet, services prices differ hugely. In principle, price differentials could be exploited to mutual benefit, offering improved job opportunities to the poor as well as better shopping opportunities to the rich. However, cross-border shopping is often...

We introduce a framework of electoral competition in which voters have general preferences over candidates’ characteristics and policies. Candidates’ immutable characteristics (such as gender, race or previously committed policy positions) are exogenously differentiated, while candidates can...

We suggest a probabilistic voting model where voters’ preferences for alternative public goods display habit formation. Current policies determine habit levels and in turn the future preferences of the voters. This allows the incumbent to act strategically in order to influence the probability...

We analyse how institutional and political decisions are intertwined. Citizens who differ in their mobility and ability vote first on labour market integration and afterwards on education policy. The institutional decision on integration influences the succeeding education policy. More...

The paper examines the relation between political participation and the size of regions taking German counties as observational units. The paper makes several contributions to the literature. To begin with, we measure political participation along two dimensions namely voter turnout, which is...

Since objective news coverage is vital to democracy, captured media can seriously distort collective decisions. The current paper develops a voting model where citizens are uncertain about the welfare effects induced by alternative policy options and derive information about those effects from...