Publisher:
University of Chicago Booth School of Business, Stigler Center for the Study of the Economy and the State, Chicago, IL
Abstract:
We develop a model of partisan factions within an accountability framework. The incumbent leader can implement reforms but faces an internal faction that may undermine reform effectiveness through dissent. Unlike the faction, the leader's preferences align with those of the voter. Dissent reveals information to the voter about the leader's strength, sometimes inducing over-reform-strong leaders reform even when they should not. Moderate factional strength enhances voter welfare by balancing reform effectiveness and policy accuracy. Active dissent can improve welfare relative to strategic silence, and strong leaders may benefit more from dissent than from silence.
