Abstracts of published papers for Jac C. Heckelman

(select papers below available in pdf format)

Contemporary Economic Policy forthcoming

Abstract. Foreign aid has often been intended by donors to entice recipient nations into policy and institutional reforms favorable to private sector economic development. In this study, we investigate the relationship between aid and changes to economic freedom in recipient nations over the 1990-2000 decade. The evidence is mixed. In general we find that foreign aid has no significant effect on economic freedom overall. However, by utilizing an hedonic approach on the different categories of economic freedom we find that aid has still managed to contribute toward a policy and institutional environment favorable to growth, as the different categories of economic freedom improved by aid more than offset those which are harmed by aid, in terms of their impact on growth.

Constitutional Political Economy forthcoming

Abstract. Empirical studies often use Freedom House ratings for Political Rights and/or Civil Liberties as institutional proxies for the degree of democracy. In this study, Granger-causality tests are used which reveal that Political Rights tend to precede Civil Liberties, but not the reverse, in a panel data set of former Soviet Republics. For transition nations, Freedom House also publishes a separate breakdown of democratic characteristics. Empirical tests suggest Civil Society and Judicial Framework Granger-cause Electoral Process, Governance Granger-causes Civil Society, and all four components Granger-cause Independent Media. Each measure of democracy is related to at least one other but no evidence for dual causation is found.

Review of Regional Studies forthcoming

Abstract. Convergence tests are performed on state level turnout rates for U.S. presidential elections from 1896 to 2004. The degree of dispersion in turnout has steadily declined since 1940, suggestive of general overall convergence taking place. Individually, it is found that 29 of the 48 continental states are stationary in their relative trend levels, and 42 states either do not significantly differ from the national average or are significantly trending toward the national average. In total, 25 of the 48 states pass tests for both stochastic and ß-convergence, suggesting that national convergence is being achieved by roughly half the states.

PS: Political Science and Politics 41: 677-678, 2008 (pdf)

Abstract. In a recent issue, Young and Sigelman (2008) present evidence of a “Dakota effect,” in which persons born in the Dakotas are disproportionately likely to represent their home state, other states, and also generate government spending directed toward the Dakotas. These authors are unable to explain the causal underpinnings for overrepresentation in Congress or the Dakotan natives' keen ability to direct pork back to these two states. As is now well established, rational choice modeling can be successfully employed to explain every political phenomenon under the sun, as well as some over the sun. As such, a rational choice model will be employed here, and using ficticious data, empirical analysis will be shown to corroborate the model. We believe this to be a major breakthrough.

Public Choice 136: 293-313, 2008 (pdf)

Abstract. This paper provides the first empirical study of delegate voting behavior on issues of slavery at the U.S. Constitutional Convention. We analyze two categories of votes: those related to apportionment and those related to the regulation of the slave trade. Although it is widely believed that delegates voted consistent with the interests of their states on issues of slavery, we find that for votes on apportionment, the effect of state interests was enhanced by both the delegate’s personal interest and his religious background. For votes regulating the slave trade, state interests had a significant effect but only within specific regions.

Economica 75: 542-548, 2008 (pdf)

Abstract. Market-oriented economic policies—reflected in limited economic activity by government, protection of private property rights, a sound monetary policy, outward orientation regarding trade and efficient tax and regulatory policy—have been strongly linked to faster rates of economic growth. Foreign aid is often provided in the belief that it encourages liberalizing reforms in these areas. This paper analyses the impact of aid on market-liberalizing policy reform, correcting for the possible endogeneity of aid. Results indicate that higher aid slowed reform over the 1980 to 2000 period, as measured by a broad index of policies. Disaggregating policy into five areas, aid is associated with slower reform in some policy areas but not in others. Disaggregating by decade, aid’s adverse impact on policy reform is much more pronounced for the 1980s than for the 1990s.

Eastern Economic Journal 34: 158-171, 2008 (pdf)

Abstract. We apply the theory of clubs to bank decisions on choosing membership in the national system and being subject to federal regulations, or remaining outside the system and opting instead for state regulation. Although costs to national membership are typically higher, member banks can use their influence to reduce these costs. This is expected to be more prominent for the larger banks, which retain greater influence on the regulators. Thus, the theory predicts membership depends on costs, which in turn depend on membership. We test these relationships in a system of simultaneous equations for the periods 1875-1913, 1914-1934, and 1935-1980. Our results are consistent with the notion of large bank memberships responding to changes in reserve ratios, and reserve ratios responding to membership rates for large banks. In addition, we find bank sensitivity to national reserve ratios to be lowest when the Fed was given additional discretion in setting reserve ratios post 1935, and federal regulator responsiveness to large bank membership was greatest during this time as well.

Journal of Theoretical Politics 20: 31-46, 2008 (pdf)

Abstract. Assuming strict two party competition, policy balancing models of the U.S. senate imply that senators from the same state will often be from opposite parties and have great ideological divergence. We analyze the effect of independent candidates on these implications. Our theoretical model implies the two state senators will generally not be from opposite parties and will be closer in ideological space than if they were elected under strict two party competition. Empirical analysis of senate composition from 1991-2002 supports the theory.

Korean Journal of Public Choice 2: 1-11, 2007

Abstract. Lottery rules are rarely used beyond breaking a tie vote. Yet, proportional lotteries have several attractive features which are discussed here. First, lotteries break the tyranny of the majority. Second, any proportional lottery which uses only a single round of voting to determine the lottery weights followed by a single weighted draw will ensure sincere preference revelation by the voters. Third, lotteries respect many of the general axiomatic principals invoked for social choice rules, in a probabilistic sense.

Journal of Economic History 67: 829-848, 2007 (pdf)

Abstract. Empirical studies of delegate voting at the Constitutional Convention have relied on the same 16 roll call votes. This paper re-examines various assumptions used in the collection of these data. We first create a baseline regression. We then consider the effect of dropping delegates not in attendance, re-inferring the votes from primary sources, examining various sub-samples of the roll calls, and reconstructing constituency variables to include state districts. Our findings suggest that for decision making at the Constitutional Convention, personal interests were indeed important but constituent interests were less important than previously claimed.

Economics Bulletin Vol 15, No. 18: 1-13, 2007 (pdf)

Abstract. This paper explores the relationship between special-interest groups and volatility of GDP growth. In an unbalanced panel of 108 countries, we find a significant negative relationship between the number of interest groups in a country and the volatility of GDP growth.

Public Choice 133: 377-391, 2007 (pdf)

Abstract. It is widely recognized that interest groups affect both microeconomic and macroeconomic outcomes. However, few researchers have attempted to discern empirically the factors that contribute to interest group activity. This paper provides a test of several theories of group formation in a panel setting. A nation's stability, socioeconomic development, political system, size, and diversity all appear to contribute to interest group formation as predicted by theory.

Southern Economic Journal 74: 18-33, 2007 (pdf)

Abstract. In the quarter-century since the publication of Rise and Decline of Nations, a large literature has evolved testing the central hypothesis regarding Olson’s thesis on institutional sclerosis. These tests have taken the form of both econometric regression analysis involving a sample of various nations and detailed narrative case studies of specific nations. Tests have appeared in both economics and political science journals, as well as in collected volumes and independent books, performed primarily by authors from America and Europe. A review of over 50 separate works reveals that on the whole the theory of institutional sclerosis is generally, but certainly not universally, supported. No systematic bias in favor or opposition to Olson is found to have arisen based on methodology, publication outlet or authorship location.

Constitutional Political Economy 18: 83-97, 2007 (pdf)

Abstract. We analyze a unique case of voting on voting with the feet, when Tennessee twice considered secession from the Union in 1861 by popular referenda. The initial votes to hold a convention, and to send disunion delegates to a convention, failed, but after the Confederate states adopted a new constitution and the bombing of Fort Sumter took place, a second set of votes to separate from the union, and to join the confederacy, passed. Regression results support the importance of both economic interests and political tendencies, along with regional differences, in explaining the variation in votes across counties. Class distinctions were not found to be significant.

American Political Science Review 100: 297-302, 2006

Abstract. Robertson (2005) argues that Roger Sherman was surprisingly influential at the constitutional convention. Using empirically estimated ideal points, we show that Sherman was indeed a pivotal voter from a pivotal state. However, we also demonstrate that if the votes were tallied by delegates individually, rather than grouping them by home state, then Sherman would have been less pivotal. This suggests that the voting procedures adopted at the constitutional convention may have affected Sherman’s ability to get his interests enacted. Such institutions might have been more responsible for making Sherman influential than his legislative abilities.

Public Choice 126: 257-274, 2006

Abstract. In presenting evidence in favor of rational partisan cycles, where electoral victories by leftist parties are expected to create temporary expansions and electoral victories by rightist parties are expected to create temporary recessions, Alesina, Cohen and Roubini (1999) rely upon autoregressive time series intervention regressions. Theses regressions, however, are not consistent with their model. In this paper, a model is derived which is consistent with the intervention approach in its reduced-form. The differences between the models are highlighted and new empirical estimates are presented on a panel of seven OECD nations, which generally does not support the rational partisan cycle implications.

Korean Journal of Public Choice 1: 35-41, 2006

Abstract. Economists and political scientists are thought to disagree on many topics, including those in the field of public choice which overlap the two disciplines. To better determine if this is true, and on which public choice topics in particular there is disagreement or consensus, we circulated a survey of public choice questions to random members of the American Economics Association and American Political Science Association. Analysis of the returned questionnaires suggests normative differences appear to be more systematic than are differences in the beliefs of basic modeling assumptions, which may influence the conclusions drawn regarding the outcomes.

Southern Economic Journal 72: 492-501, 2005

Abstract. Economic freedom indicators have become quite popular recently as a useful tool to quantify the relationship between a country's institutions and its prosperity. Hanson (2003) criticizes these types of studies for: (1) failing to adequately distinguish between different proxies for economic freedom, (2) not considering the potential for endogeneity, and (3) for accepting significance of economic freedom's ability to promote prosperity even though regression analysis generates "nonsensical" results. Closer inspection reveals that most of his arguments are questionable, do not apply to much of the literature, or are not original, and that he is guilty of misinterpreting his own econometric evidence relating freedom to the level of GDP.

Economics and Politics 17: 331-350, 2005

Abstract. The theory of opportunistic political business cycles predicts incumbent politicians will alter their economic policies to spur short-run growth to attract additional votes for the upcoming election. There has not been much emphasis on the possibility of historical political business cycles prior to the Keynesian Revolution. No study has yet undertaken a systematic approach to testing for policy cycles during this period. Our study will bridge this gap by considering cycles in monetary policy for the periods of 1879-1914 until the start of Fed operations, and 1914-1932 until abandonment of the gold standard. To properly test for political cycles, it is necessary to develop reaction functions for the Treasury and compare against the reaction function later held by the Fed. This also reveals that creation of an independent monetary authority to be insulated from political pressures changed the manner in which policy was directed, aside from political issues. The evidence is not consistent, however, with monetary cycles closely tied to electoral concerns.

Explorations in Economic History 42: 529-546, 2005

Abstract. Little attention has been given to the cigarette bans that were enacted by many states in the late-19 th and early-20 th century. The recent study by Alston et al. (2002) represents the only empirical analysis of this issue. Alston et al., as typical for many other studies of historical regulatory movements, rely on legislative vote outcomes. In this article we examine the only occasion when a cigarette ban was put to a popular vote, in Oregon in 1930, and highlight the benefits of studying direct democratic votes to assess support for regulatory movements. To study the relationship between the anti-cigarette movement and other reform movements of the era, we compare the determinants of support for the cigarette ban with support for an Oregon alcohol prohibition referendum in 1933. Our results suggest that supporters of both reform movements were more likely to be found in counties with higher percentages of women, evangelical Protestants, and rural residents, which contrasts with Alston et al.’s study of state legislative behavior. In addition, greater support for alcohol prohibition in particular was found in counties with a larger percentage of immigrants and, to a lesser extent, more registered Republicans.

European Journal of Political Economy 21: 953-966, 2005

Abstract. Empiricists have used various editions of an economic freedom index (EFI) initially developed by Gwartney, Lawson and Block (1996) to examine the relationship between economic freedom and other socio-economic variables, such as growth or investment. The EFI quantifies the level of particular institutional characteristics thought to promote economic freedom and aggregates them into a single index value. The aggregation procedures utilized by Gwartney and Lawson in developing their index have changed over time and other scholars have promoted alternative methods. We examine several index aggregation procedures and show that each design may have potential methodological flaws which can greatly affect the empirical findings.

American Economist 49: 66-78, 2005

Abstract. Are Public Choice scholars' conclusions accepted by rank-and-file economists and political scientists? If not, why not? To answer these questions we use survey results to compare the conclusions of self-identified public choice scholars with those in the adjacent disciplines of economics and political science. We examine thirty-five propositions in seven areas: (1) assumptions about political actors; (2) normative beliefs about government and voting; (3) elections and economic performance; (4) parties, platforms, voting and preferences; (5) government's purposes and growth; (6) individual behavior--voting-with-feet and free riding; and (7) government and the market. We conclude that, although there is a consensus on many of the issues, there is substantial remaining disagreement on many questions that appears to be tied to the competing presuppositions of scholars in economics and political science.

Abstract. The weak government argument claims that fractionalized governments (coalition or minority governments) have more difficulty increasing their tax revenues or decreasing their spending than majority governments. This implies that weaker governments are associated with higher government deficits. In this paper, we test the implication of a fractionalization effect within the optimum financing model that suggests governments raise both their tax and seigniorage revenues to finance additional spending. We test the hypothesis for a sample of ten OECD countries for the period 1975-1997 and extend the period for the non-EU nations in the sample to cover 1975-2003. The empirical evidence presented here supports a positive relationship between the degree of fractionalization and seigniorage revenue. Our results also suggest that creation of seigniorage revenue is lower under right-wing governments and an independent central bank.

Economic Theory 26: 607-617, 2005

Abstract. The pairwise lottery system is a multiple round voting procedure which chooses by lot a winner from a pair of alternatives to advance to the next round where in each round the odds of selection are based on each alternative's majority rule votes. We develop a framework for determining the asymptotic relative likelihood of the lottery selecting in the final round the Borda winner, Condorcet winner, and Condorcet loser for the three alternative case. We also show the procedure is equivalent to a Borda lottery when only a single round of voting is conducted. Finally, we present an alternative voting rule which yields the same winning probabilities as the pairwise lottery in the limiting case as the number of rounds of the pairwise lottery becomes large.

WINNER OF FIRST GORDON TULLOCK PRIZE FOR BEST ARTICLE IN PUBLIC CHOICE BY YOUNGER SCHOLAR

Public Choice 118: 87-103, 2004

Abstract. The importance of primary elections is considered within the context of U.S. Senate elections where senators serve overlapping terms and voters are assumed to balance their two senators against each other. Voters behave strategically in the primaries but convergence to the median position is not achieved except as a knife-edge result. More generally, constraints in the party space prevent the party of the sitting senator from obtaining the median’s preference allowing the opposition party to nominate a candidate further away from the median while still capturing the median voter. Empirical evidence supports the notion that senate divergence is a function of the state primary system.

The Independent Review 8: 419-425, 2004

Abstract. This paper outlines a theory in which incumbent candidates are shown to benefit from secret ballot laws. The role of private information is central to this result which can be explained as follows. First, bribery is expected to occur under an open ballot system but not under secret ballots since voters need not reveal their underlying preferences. Second, since vote-buying efficiency differs between candidates when voter distributions are unequal, candidates possessing an incumbency advantage are shown to be relatively inefficient and thus benefit from eliminating the vote market.

PS: Political Science and Politics 36: 797-799, 2003

Abstract. Critics of public choice analysis argue that these scholars are different. They are self-selected into the field, their arguments and conclusions are dominated by their personal ideological positions, and therefore other scholars do not accept their results. A survey of members of the Public Choice Society, American Economic Association, and American Political Science Association shows that most of the public choice propositions accepted by public choice scholars are also accepted by general economists, but less so by general political scientists.

Public Choice 117: 333-340, 2003

Abstract. Mancur Olson's institutional sclerosis hypothesis may be evident in the effects of interest groups on investment in physical capital. To test this proposition, we use cross sectional data on 42 countries for which information on the number of interest groups is available to estimate the effect of those groups on the share of GDP that goes into physical investment. The results indicate that interest groups have a different effect on physical investment in OECD and non-OECD countries. In the OECD countries, we find support for the hypothesis that interest groups harm investment in physical capital. In developing countries, interest groups either have no effect on physical investment or they have a slight beneficial impact.

Collective Choice: Essays in Honor of Mancur Olson, (Jac C. Heckelman and Dennis Coates(eds.)), Springer-Verlag, pp. 129-142, 2003

Abstract. We test for the impact of interest groups on economic growth among the OECD nations. We find more evidence of an absolute effect from the number of groups than a relative effect of the number of groups compared to the size of government. The effects are non-linear, as additional group formation is less harmful the more groups that already exist, although total growth would still be hampered by their presence. When controlling for the absolute number of groups, the relative measure has no additional impact, but controlling for the relative measure increases the estimated average effect of the absolute number of groups. In addition, the negative influence of a given number of interest groups on growth is lessened over time.

Social Choice and Welfare 21: 455-468, 2003

Abstract. An alternative voting system, referred to as probabilistic Borda rule, is developed and analyzed. The winning alternative under this system is chosen by lottery where the weights are determined from each alternative's Borda score relative to all Borda points possible. Advantages of the lottery include the elimination of strategic voting on the set of alternatives under consideration and breaking the tyranny of majority coalitions. Disadvantages include an increased incentive for strategic introduction of new alternatives to alter the lottery weights, and the possible selection of a Condorect loser. Normative axiomatic properties of the system are also considered. It is shown this system satisfies the axiomatic properties of the standard Borda procedure in a probabilistic fashion.

Economic Inquiry 41: 705-712, 2003

Abstract. We apply the economic theory of crime to the National Hockey League. We analyze a natural experiment in which games during the 1999-2000 season had either one or two referees. We determine the effect of the number of referees on both the number of penalties called and the number of rules infractions committed by players. The results indicate that increasing the number of referees leads to greater enforcement of the rules but does not significantly deter players from committing infractions.

International Journal of Business and Economics 1: 251-261, 2002

Abstract. The measurement of economic freedom is discussed. One particular set of freedom indices, developed by Heritage Foundation, is detailed including how the indices are constructed and potential problems in the methodological design. Comparisons are made for the different levels of freedom individual nations and regions achieve.

Public Choice 113: 179-189, 2002

Abstract. The partisan advantage and incumbency advantage versions of the rational partisan business cycle model are tested. Both models assume agents form weighted averages of partisan inflation rates during an election period, and differ only in how the weights are formed which alters the form of business cycles. The partisan advantage assumes fixed weights designated for both major parties in each election, whereas the incumbency advantage model assumes fixed weights for whichever is the incumbent and opposition party in each election. The symmetric representation assumes each election is a toss-up. Strongest support is found for a temporary symmetric effect on the level of output, but none of the models are supported for temporary electoral changes in growth or unemployment rates.

Canadian Journal of Economics 35, 568-585, 2002

Abstract. The Variable Rational Partisan Business Cycle model is developed, where agents face uncertainty regarding the timing and outcome of the next election. The model predicts that partisan influences on the economy persist throughout the government's rule, and are further influenced, in the opposite direction, by which party ruled in the previous period. Party popularity also has a causal effect on the business cycle. Finally, the effects from changes in election timing expectations are dependent on which party ruled in the previous period. Empirical results for output and unemployment in Canada, Germany and United Kingdom yield mixed support for the model.

Economics of Governance 3, 47-57, 2002

Abstract. The secret ballot was designed to eliminate the incentive for candidates to purchase votes through direct vote buying. When voters have private information on their candidate preferences, incumbent candidates will generally be less efficient in purchasing votes than their challengers. Incumbent candidates may therefore benefit from the elimination of direct vote purchasing. Viewed in this vein, passage of secret ballot laws by state legislatures can be seen as an institutional mechanism to protect their incumbency advantage, rather than as an act of necessary electoral reform to create fair elections and protect democracy.

Journal of Applied Economics 4, 329-360, 2001

Abstract. We estimate the influence of defense spending and military labor use on economic growth in African and Latin American countries. Our model integrates disparate implications from the defense economics literature into a Barro-style model of economic growth that controls for political and economic institutional variation across countries. Our panel data analysis of 44 countries in Africa and Latin America from 1975 to 1989 also controls for cross-country variation in lost human capital and public sector production inefficiencies. We find empirical evidence that the defense burden on economic growth is non-linear, with low levels of military spending increasing economic growth but higher levels of military spending decreasing growth. We also find evidence that the influence of military labor use on growth is non-linear, and exhibits a greater drag on economic growth in those countries with relatively higher levels of adult male education attainment.

European Journal of Political Economy 17, 835-852, 2001

Abstract. In this paper we analyze a multiple winner rent-seeking contest where the number of winners is set by a self-interested regulator. The winners receive a license to compete in a market. The structure of competition in the market influences the number of winners through the preferences of the regulator. The model implies that Cournot competitors are often better off than firms that are able to collude on output determination.

Journal of Macroeconomics 23, 261-275, 2001

Abstract. This paper develops a model where rational economic agents face uncertainty regarding the timing of elections and which party will emerge victorious should an election occur. This electoral uncertainty affects the macroeconomy, where the size and direction of the impacts are dependent on the party in power in the current and previous period, time elapsed since the last election, and party popularity. Leftist governments are expected to sustain higher output levels throughout their electoral term compared to rightwing governments, and the partisan differences will continue to increase until the next election.

Applied Economics 33, 417-426, 2001

Abstract. This paper develops an econometric intervention model representing the standard empirical approach to testing Alesina's (1987) Rational Partisan Theory implication that elections lead to short-term changes in output growth and unemployment. This intervention approach may be subject to two econometric difficulties. First, the cyclical nature of the autoregressive variables suggest the regression residuals may be serially correlated. Second, the election intervention variable may be endogenous to the cyclical variables. Empirical support for the model is mixed. Ordinary Least Squares estimates for both series produce a coefficient for the intervention variable which is of the predicted sign but not significant. The output growth regression results are robust to serial correlation and endogeneity concerns. For unemployment, controlling for serial correlation generates a significant coefficient, but adjusting for endogeneity does not.

Kyklos 53, 527-544, 2000

Abstract. The literature on economic freedom and growth has utilized summary measures of freedom to determine its general significance for economic growth. We believe the summary measures lead to misspecification problems. We utilize Heston-Summers growth data to determine which of the disaggregated categories of economic freedom lead to growth and find that only a few of the indexes significantly affect growth. These growth regressions generate new weights for aggregating the indexes into an overall summary measure. This new measure can be interpreted as deriving a relative ranking of nations that have a relatively higher presence of growth promoting economic freedoms and more restrictions on those economic freedoms that inhibit growth.

Public Choice 104, 319-327, 2000

Abstract. Empirical studies designed to test Olson's (1982) theory of institutional sclerosis are typically forced to rely upon proxies to measure the ability of special interest groups to engage in redistributive activities, which in turn are expected to hinder economic growth. This note shows that reliance on proxies biases the estimates toward zero. Here, instrumental variable routines are utilized which increase the estimated impact of special interests on the economy.

Journal of Applied Economics 3, 71-91, 2000

Abstract: The freedom and growth literature has consistently shown that nations which have fewer restrictions on private agents and transactions tend to higher levels of economic growth. It is less clear, however, whether freedom causes growth, growth causes freedom, or the two are jointly determined. To assess these possibilities, Granger-causality tests are performed on annual freedom indicators developed by the Heritage Foundation and national growth rates. The underlying component indexes, which include Trade Policy, Taxation, Government Intervention, Monetary Policy, Capital Flows and Foreign Investment, Banking, Wage and Price Controls, Property Rights, Regulation, and Black Markets, are also tested in addition to the summary freedom rating. The tests suggest the average level of freedom in a nation, as well as many of the specific underlying components of freedom, precedes growth. However, growth may precede one of the component indexes (Government Intervention), and no relationship is found to exist between growth and two of the indexes (Trade Policy and Taxation).

Journal of Economic Behavior and Organization 42, 97-108, 2000

Abstract. This paper presents a model in which voters attempt to balance the ideological positions of their senate representatives. Candidate positions are determined endogenously through a primary system. The median voter theorem is applied in each election to determine winning platforms based on voter preferences which may differ from their individual bliss points. Contrary to the original median voter theorem, the main implications of this model are that: (i) convergence on platform positions is not achieved in the general election, and (ii) extremist candidates defeat moderates in the stable long-run equilibrium.

American Politics Quarterly 28, 194-215, 2000

Abstract. Two theories within the legal-institutional framework concerning the Australian Ballot System's effect on voter turnout are analyzed. The vote market hypothesis assumes secret ballots were designed to end the buying and selling of votes. The secrecy the new ballot provided discouraged candidates from buying votes they could no longer verify, disproportionately affecting poor voters who would respond to this loss of payments by voluntarily abstaining. Alternatively, the theory of strategic disfranchisement predicts blacks and illiterates were specifically targeted for disfranchisement. The new ballots were expected to be more difficult for these voters to use and they would then be effectively prevented from participating in the active electorate. Although turnout decreases under either theory, the normative implications are very different. Controlling for race and illiteracy, regression analysis suggests poor voters were less likely to vote a secret ballot. A similar effect is not found for black and illiterate voters when controlling for income. The evidence is thus more consistent with the vote market hypothesis than a pure disfranchisement effect.

Quarterly Journal of Business and Economics 38, 45-56, 1999

Abstract. Rational partisan theory predicts macroeconomic fluctuations are triggered by possible changes in government policies due to elections. Empirical testing may fall prey to an endogeneity problem when incumbent governments determine the timing of an election and voters respond to current economic conditions in their choice of party support. Hausman tests suggest elections in Britain are endogenous to growth and stronger support is found for rational partisan theory using an instrumental variable routine.

Journal of Public Finance and Public Choice 17, 11-18, 1999

Abstract. Previous empirical studies designed to test the rational expectations partisan model of Alesina [1987] have generally looked for changes in real macroeconomic variables following a change in party power (incumbent party loss), whereas the model predicts these variables should fluctuate in a predictable manner even when the incumbent party is reelected. It is shown in this paper that the previous evidence is supportive of a partisan policy model where agents employ adaptive expectations, in which case only changes in party power lead to partisan economic fluctuations of real variables.

Public Choice Interpretations of American Economic History (Jac C. Heckelman, John C. Moorhouse, and Robert Whaples (eds.)), Kluwer Academic Press 147-161, 1999

Abstract. Between 1914 and 1980 state-chartered banks were free to accept or forgo the costs and benefits of Federal Reserve membership. Their decisions were sensitive to changes in the burden of the Fed's reserve requirements caused by fluctuations in interest rates. But large banks were less likely than small banks to change their membership status, especially after the Fed acquired discretion over its reserve requirements in 1935. These choices fall within the theory of clubs and illustrate rent seeking, voting with the feet, and the exploitation of the great by the small. We develop a model of the Fed's determination of the conditions of membership subject to expected bank responses and then formalize the membership decisions of profit-seeking banks taking account of their possible influences on the Fed. In essence, all banks are likely to vote with their feet depending on membership costs, but small banks may free ride on large bank lobbying of the Fed for reduced reserve ratios. This effect should be stronger after the New Deal enhancements of Fed discretionary powers.

Applied Economics Letters 5, 789-791, 1998

Abstract. By modifying Berument's divided government-optimum financing model to include partisan interests, it is found that when the Democratic party controls both the Congress and Presidency, real monetary base grows at a higher rate than when the Republican party controls both branches. In addition, it is found that monetary base grows at the slowest rate when neither party controls both branches, supporting a gridlock version of divided government.

Economics & Politics 10, 297-309, 1998

Abstract. The theory of political business cycles predicts economies will experience a short-run expansion during an election period. Cross-sectional evidence from 1870, 1880, 1890, 1900, and 1910, does not reveal statistically significant differences in gainful employment rates between states with and without a gubernatorial election in that year. Pooled regression analysis suggests gubernatorial elections are positively correlated with the state employment rate, but an annual fixed effect model designed to account for differences in the measurement of gainful employment mitigates this conclusion.

The Social Science Journal 35, 435-443, 1998

Abstract. This article distinguishes between two types of vote buying mechanisms. If vote choices can be monitored, vote buyers will not discriminate amongst prospective voters, regardless of how they are expected to vote. If voting is secret, a vote buyer will pay opposition voters not to vote which forces the opposition to pay its own voters to ensure they do vote. This implies the secret ballot may be less effective in curbing bribery than originally thought.

Social Science Research 26, 121-134, 1997

Abstract. The ecological fallacy literature suggests aggregate data cannot be used for microlevel inference. Building upon an aggregated logit model developed by Kelejian (1995), I am able to show that the estimated coefficients from aggregate data regressions are directly related to the true underlying microcoefficients, so meaningful interpretations can still be made. It is also suggested that in the cases where aggregation bias can be rejected, the microcoefficients can be directly estimated. An application of the model is shown using state-level data for historical elections in which survey data are unavailable.

Public Choice 82, 107-124, 1995

Abstract. Secrecy in the voting process eliminated an important motivation for voting. No longer able to verify the voters' choices, political parties stopped offering payments in return for votes. Within the rational voter framework, it will be shown that these payments were a prime impetus for people to vote. Without a vote market to cover their voting costs, many voters were rational to stay away from the polls. This hypothesis is supported through a series of empirical tests culminating in a multivariate legislative regression. When other electoral laws are controlled for, the secret ballot accounts for 7 percentage points lower Gubernatorial turnout.