Political Accountability and Policy Experimentation: Why to Elect Left-Handed Politicians?

31 Pages Posted: 26 Mar 2013

See all articles by Tim Willems

Tim Willems

University of Oxford - Nuffield Department of Medicine

Date Written: March 13, 2013

Abstract

This paper analyzes how political accountability affects the incentives of policy makers to learn through experimentation with new policies. It shows that when voters face an inference problem on the competence level of policy makers, reelection concerns reduce experimentation incentives to the benefit of the status quo. Whether experimentation in representative democracies is suboptimally low, depends on society's degree of risk aversion relative to that of the decision maker. If the level of experimentation is suboptimal, taking decisions by direct democracy, or electing risk-loving politicians, could improve welfare. Interestingly, risk-lovers also seem to be overrepresented among Presidents of various countries.

Keywords: policy experimentation, learning, political economy, reform, status quo bias, career concerns

JEL Classification: D72, D83

Suggested Citation

Willems, Tim, Political Accountability and Policy Experimentation: Why to Elect Left-Handed Politicians? (March 13, 2013). Available at SSRN: https://ssrn.com/abstract=2239365 or http://dx.doi.org/10.2139/ssrn.2239365

Tim Willems (Contact Author)

University of Oxford - Nuffield Department of Medicine ( email )

New Road
Oxford, OX1 1NF
United Kingdom

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