Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/107760
Authors: 
Seebauer, Michael
Year of Publication: 
2015
Series/Report no.: 
IWQW Discussion Paper Series 01/2015
Abstract: 
This study investigates the effects of the provision of costly initiatives on policy efficiency in a laboratory experiment where a policy setter implements a status quo affecting the utility of the constituency. I vary treatments regarding the political institution (either purely representative or direct democracy where the status quo may be contested by the costly proposal of an alternative) and the appointment of the policy setter (either random or by election). In accordance to theoretical predictions, the experimental data reveal a substantial indirect effect of direct democracy inducing higher efficiency levels by serving as a credible threat towards the policy setter without actually being used. Moreover, the initiative impedes excessive candidate competition during elections reducing campaign costs and thus increasing overall efficiency. In contrast to theoretical predictions, the initiative is actually employed frequently, so there is also a sizeable direct effect of the initiative. However, this effect is generally overcompensated by the costs induced by the process.
Subjects: 
Direct Democracy
Policy Decision
Efficiency
Laboratory Experiment
JEL: 
D72
D61
C92
Document Type: 
Working Paper

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