Voters are Rational

Government Institute for Economic Research Working Papers No. 50

52 Pages Posted: 10 Oct 2013

See all articles by Teemu Lyytikäinen

Teemu Lyytikäinen

Government of the Republic of Finland - VATT Institute for Economic Research; Spatial Economics Research Centre (SERC)

Janne Tukiainen

VATT Institute for Economic Research; University of Turku - Turku School of Business - Department of Economics

Date Written: September 27, 2013

Abstract

We test whether voters are rational in the sense that their decision to vote depends on its expected impact on the election outcomes. By using exogenous variation in pivotal probabilities that arise at population thresholds determining council sizes in Finnish municipal elections, we provide the first causal evidence on this rational voting hypothesis. We find statistically significant, economically relevant and robust effects of crossing the threshold on turnout. Furthermore, we use a novel instrumental variables design to show that the changes in the pivotal probabilities rather than simultaneous changes in available candidates drive the results. Thus, the rational voter exists.

Keywords: Local government elections; Rational voting hypothesis; Regression discontinuity design

JEL Classification: D720, C290

Suggested Citation

Lyytikäinen, Teemu and Tukiainen, Janne, Voters are Rational (September 27, 2013). Government Institute for Economic Research Working Papers No. 50. Available at SSRN: https://ssrn.com/abstract=2334094 or http://dx.doi.org/10.2139/ssrn.2334094

Teemu Lyytikäinen (Contact Author)

Government of the Republic of Finland - VATT Institute for Economic Research ( email )

Arkadiankatu 7
P.O Box 1279
Helsinki, FIN-00531
Finland

Spatial Economics Research Centre (SERC) ( email )

United Kingdom

Janne Tukiainen

VATT Institute for Economic Research ( email )

Arkadiankatu 7
P.O Box 1279
Helsinki, FIN-00101
Finland

University of Turku - Turku School of Business - Department of Economics ( email )

Rehtorinpellonkatu 3
Turku, 20014
Finland

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