Veto Players and Policy Trade-Offs: An Intertemporal Approach to Study the Effects of Political Institutions on Policy

Inter-American Development Bank Working Paper Series No. IDB-WP-159

45 Pages Posted: 4 Dec 2010

See all articles by Carlos Scartascini

Carlos Scartascini

Research Department - Inter-American Development Bank (IDB)

Ernesto Stein

Inter-American Development Bank (IDB)

Mariano Tommasi

Universidad de San Andres - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: March 1, 2010

Abstract

The capacity to sustain policies over time and the capacity to adjust policies in the face of changing circumstances are two desirable properties of policymaking systems. The veto player approach has suggested that polities with more veto players will have the capacity to sustain policies at the expense of the ability to change policy when necessary. This paper disputes that assertion from an intertemporal perspective, drawing from transaction cost economics and repeated game theory and showing that some countries might have both more credibility and more adaptability than others. More generally, the paper argues that, when studying the effects of political institutions on policy outcomes, a perspective of intertemporal politics might lead to predictions different from those emanating from more a-temporal approaches.

Keywords: Political Institutions, Public Policies, Veto Players, Policy Adaptability, Policy Stability, Intertemporal, Credibility, Repeated Games

JEL Classification: D72, D78, H10, H50

Suggested Citation

Scartascini, Carlos G. and Stein, Ernesto Hugo and Tommasi, Mariano, Veto Players and Policy Trade-Offs: An Intertemporal Approach to Study the Effects of Political Institutions on Policy (March 1, 2010). Inter-American Development Bank Working Paper Series No. IDB-WP-159, Available at SSRN: https://ssrn.com/abstract=1719286 or http://dx.doi.org/10.2139/ssrn.1719286

Carlos G. Scartascini (Contact Author)

Research Department - Inter-American Development Bank (IDB) ( email )

1300 New York Avenue NW
Washington, DC 20577
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2026231963 (Phone)

HOME PAGE: http://www.cscartascini.org

Ernesto Hugo Stein

Inter-American Development Bank (IDB) ( email )

1300 New York Avenue, NW
Research Department
Washington, DC 20577
United States

Mariano Tommasi

Universidad de San Andres - Department of Economics ( email )

Vito Dumas 284
Victoria, Buenos Aires B1644BID
Argentina
+5411-4725-7020 (Phone)

HOME PAGE: http://faculty.udesa.edu.ar/tommasi/index.htm

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