Polarization and Policy Design

Abstract

Voters in the U.S. and elsewhere have become highly polarized. How does this impact policymaking? We provide a theory to examine this question in the context of distributive politics and find that polarization can have a non-monotonic effect on equity. Political turnover and the inter-temporal resolution of policy uncertainty play key roles for this result. The implications of alternative electoral systems are also examined: contrary to conventional wisdom, proportional systems may exacerbate partisan policymaking compared to majoritarian systems.

Keywords: Polarization, Policy Design, Inequality