We develop a model of the political consequences of public income volatility. As is standard, political incentives create inefficient policies, but we show that making income uncertain creates specific new effects. Future volatility reduces the benefit of being in power, making policy more...

A key idea in political economy is that policy is often tailored to voters who are not ideologically attached - swing voters. We show, however, that in political environments where political parties can use repression and violence to exclude voters from elections, they may optimally target the...

Why do soft budget constraints exist and persist? In this paper we argue that the prevalence of soft budget constraints can be best explained by the political desirability of softness. We develop a political economy model where politicians cannot commit to policies that are not ex post optimal....

A key idea in political economy is that policy is often tailored to voters who are not ideologically attached - swing voters. We show, however, that in political environments where political parties can use repression and violence to exclude voters from elections, they may optimally target the...

We develop a model to understand the incidence of presidential and parliamentary institutions. Our analysis is predicated on two ideas: first, that minorities are relatively powerful in a parliamentary system compared to a presidential system, and second, that presidents have more power with...

Why do soft budget constraints exist and persist? In this paper we argue that the prevalence of soft budget constraints can be best explained by the political desirability of softness. We develop a political economy model where politicians cannot commit to policies that are not ex post optimal....

We provide a potential explanation for the absence of, and unwillingness to create, centralized power in the hands of a national state in many societies based on the political agenda effect. State centralization induces citizens of different backgrounds, interests, regions or ethnicities to...