Incumbency Disadvantage of Political Parties: The Role of Policy Inertia and Prospective Voting
64 Pages Posted: 28 Jan 2019 Last revised: 21 Feb 2019
Date Written: 2019-01-24
We document that postwar U.S. elections show a strong pattern of â€œincumbency disadvantage": If a party has held the presidency of the country or the governorship of a state for some time, that party tends to lose popularity in the subsequent election. To explain this fact, we employ Alesina and Tabellini's (1990) model of partisan politics, extended to have elections with prospective voting. We show that inertia in policies, combined with sufficient uncertainty in election outcomes, implies incumbency disadvantage. We find that inertia can cause parties to target policies that are more extreme than the policies they would support in the absence of inertia and that such extremism can be welfare reducing.
Keywords: rational partisan model, incumbency disadvantage, policy inertia, prospective voting, median voter
JEL Classification: D72, H50
Suggested Citation: Suggested Citation