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Social Choice and Welfare

, Volume 50, Issue 4, pp 721–739 | Cite as

Electoral competition under costly policy implementation

  • Dimitrios Xefteris
  • Galina Zudenkova
Original Paper
  • 105 Downloads

Abstract

This paper analyzes a unidimensional electoral competition model between two policy-motivated candidates, assuming that the elected candidate has to incur an idiosyncratic policy implementation cost. Think of this as the election of chairman in an academic department, a parent-teacher association, or a condominium association board, where the election winner perceives office holding as a cost, and not benefit. We prove that in such a game, a pure strategy Nash equilibrium is guaranteed to exist even when the policy implementation costs are heterogeneous, as long as they are not very large. We also provide the equilibrium characterization, comparative statics, and welfare analysis in the case of Euclidean preferences. In particular, we show that equilibrium strategies are divergent and in general not symmetric around the expected bliss point of the median voter. A higher policy implementation cost makes a candidate propose a more extreme policy, and lowers his electoral chances. Naturally, the voter’s welfare decreases when the candidates’ implementation costs increase.

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Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Department of EconomicsUniversity of CyprusNicosiaCyprus
  2. 2.Department of EconomicsUniversity of MannheimMannheimGermany

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