Humberto Llavador

Different Concepts of Sustainability and International Arrangements

Humberto Llavador et al. — Mon, 25 Jul 2011 03:03:58 PDT

Mapas de Ayuda para América Latina y el Caribe

Humberto Llavador — Mon, 25 Jul 2011 03:00:08 PDT

How should we draw the optimal map for the allocation of international aid? Should it maximize global poverty reduction, or try to equalize opportunities among recipient countries to reduce poverty? This article shall look into the “normative” debate on the geographical allocation of aid, and propose alternative distributional schemes for a particular developing region: Latin America and the Caribbean. We specify two different allocation models, the first one based on the utilitarian approach (which maximizes the regional poverty reduction for 2015) and the second one based on the equal opportunity approach (which equalizes opportunities to reduce poverty among countries). Finally, we discuss the implications of both maps, and argue in favour of the need to define a strategic allocation map for Latin America and the Caribbean that is truly fair and effective, according to the regional disparities in terms of the paces in poverty reduction, the development opportunities and the political efforts of reform.

Experimentos en Economía Política

Humberto Llavador — Mon, 25 Jul 2011 02:53:55 PDT

Immigration Policy with Partisan Parties

Humberto Llavador et al. — Wed, 04 Nov 2009 13:37:42 PST

This paper analyzes the political economy of immigration when the salient electoral issue is the level of immigrants and the relevant immigration policy is the expenditure in immigration control. We consider that immigration affects voters’ welfare through economic and non economic factors. We model political competition à la Wittman with the ideology of parties endogenously determined at equilibrium. At equilibrium, parties propose different levels of immigration, located to the left and to the right of the median voter’s ideal point, and combine skilled and unskilled workers among their constituencies. Numerical simulations provide the levels of immigration proposed by the two parties and the composition of parties’ constituencies as we vary the efficacy of immigration control and the intensity of immigration aversion.

Intergenerational Justice when Future Worlds are Uncertain

Humberto Llavador et al. — Wed, 04 Nov 2009 13:34:24 PST

Let there be a positive (exogenous) probability that, at each date, the human species will disappear. We postulate an Ethical Observer (EO) who maximizes intertemporal welfare under this uncertainty, with expected-utility preferences. Various social welfare criteria entail alternative von Neumann Morgenstern utility functions for the EO: utilitarian, Rawlsian, and an extension of the latter that corrects for the size of population. Our analysis covers, first, a cake-eating economy (without production), where the utilitarian and Rawlsian recommend the same allocation. Second, a productive economy with education and capital, where it turns out that the recommendations of the two EOs are in general different. But when the utilitarian program diverges, then we prove it is optimal for the extended Rawlsian to ignore the uncertainty concerning the possible disappearance of the human species in the future. We conclude by discussing the implications for intergenerational welfare maximization in the presence of global warming.

A Dynamic Analysis of Human Welfare in a Warming Planet

Humberto Llavador et al. — Wed, 04 Nov 2009 13:30:22 PST

Climate science indicates that climate stabilization requires low GHG emissions. Is this consistent with nondecreasing human welfare?

Our welfare or utility index emphasizes education, knowledge, and the environment. We construct and calibrate a multigenerational model with intertemporal links provided by education, physical capital, knowledge and the environment.

We reject discounted utilitarianism and adopt, first, the Pure Sustainability Optimization (or Intergenerational Maximin) criterion, and, second, the Sustainable Growth Optimization criterion, that maximizes the utility of the first generation subject to a given future rate of growth. We apply these criteria to our calibrated model via a novel algorithm inspired by the turnpike property.

The computed paths yield levels of utility higher than the level at reference year 2000 for all generations. They require the doubling of the fraction of labor resources devoted to the creation of knowledge relative to the reference level, whereas the fractions of labor allocated to consumption and leisure are similar to the reference ones. On the other hand, higher growth rates require substantial increases in the fraction of labor devoted to education.

Why do Parties Exclude Important Issues from their Electoral Campaigns?

Humberto Llavador et al. — Wed, 04 Nov 2009 13:21:22 PST

Abstention and Political Competition

Humberto Llavador — Sun, 13 Apr 2008 13:11:56 PDT

The classical literature on spatial majority voting postulates that all citizens vote. The Median Voter Theorem (MVT) then obtains when parties have perfect information on voter behavior and are either office-seekers ("Downsian") or ideological. This paper introduces abstention, a simple yet realistic modification. We show that the main features of the MVT survive to a large extent but subject to some qualifications. First, the winning policy does not bear any necessary relation to the median voter. Second, there exist examples in which the candidates choose different positions at equilibrium. Third, equilibrium may fail to exist or be unique. Finally, the equilibria of the model with office-motivated parties may differ from the ones where parties are ideological.

An Equal-Opportunity Approach to the Allocation of International Aid

Humberto Llavador et al. — Sun, 13 Apr 2008 13:10:29 PDT

How should international aid be distributed? The most common view is according to some utilitarian formula: in order to maximize the average growth rate of aid recipients or the growth rate of income of the class of recipient countries. Recently, the The World Bank [The World Bank, 1998. Assessing aid, World bank policy research report] has published a study demonstrating the importance of good economic management, within a recipient country, in transforming aid into economic growth. We identify good economic management with effort, and ask, how should aid be distributed to equalize opportunities [among recipient countries] for achieving growth, according to Roemer's theory of equal opportunity [Roemer, J.E., 1998. Equality of Opportunity. Harvard University Press, Cambridge, MA]

Electoral Platforms, Implemented Policies and Abstention

Humberto Llavador — Sun, 13 Apr 2008 13:08:06 PDT

Recent studies of American politics evidence that political polarization of both the electorate and the political elite have moved ``almost in tandem for the past half century" (McCarty, Poole and Rosenthal, 2003:2), and that party polarization has steadily increased since the 1970s. On the other hand, the empirical literature on party platforms and implemented policies has consistently found an imperfect but non-negligible correlation between electoral platforms and governmental outcomes: while platforms tend to be polarized, policies are moderate or centrist. However, existing theoretical models of political competition are not manifestly compatible with these observations. This paper distinguishes between electoral platforms and implemented policies by incorporating a non-trivial policy-setting process. It follows that voters may care not only about the implemented policy but also about the platform they support with their vote. We find that while parties tend to polarize their positions, the risk of alienating their constituency prevents them from radicalizing. The analysis evidences that the distribution of the electorate, and not only the (expected) location of a pivotal voter, matters in determining political outcomes. Our results are consistent with the observation of polarized platforms and moderate policies, and the alienation and indifference components of abstention.

Voting with Preferences over Margins of Victory

Humberto Llavador — Sun, 13 Apr 2008 13:06:14 PDT

This paper analyzes a two-alternative voting model with the distinctive feature that voters have preferences over margins of victory. We study voting contests with a finite as well as an infinite number of voters, and with and without mandatory voting. The main result of the paper is the existence and characterization of a unique equilibrium outcome in all those situations. At equilibrium, voters who prefer a larger support for one of the alternatives vote for such alternative. The model also provides a formal argument for the conditional sincerity voting condition in Alesina and Rosenthal (1995) and the benefit of voting function in Llavador (2006). Finally, we offer new insights on explaining why some citizens may vote strategically for an alternative different from the one declared as the most preferred.

Partisan Competition, Growth and the Franchise

Humberto Llavador et al. — Sun, 13 Apr 2008 12:59:02 PDT

The nineteenth century was a time of rapid economic growth and development. Over this period, the seeds sown by the industrial revolution were realized by expansions in technology and markets. Many countries saw also large-scale changes in the distribution of political voice, changes leading not only to increases in the electorate, but also to massive decreases. The concurrence of changes in the “engines of economic growth” and political voice is not coincidence. In this paper, we present an argument for changes in the franchise in which an elite split along economic interests use the suffrage to influence implemented policies. Through the influence of these policies on the character of industrialization, we analyze the effects of franchise changes on economic growth. We identify in the social structure of society an explanation for the connection between enfranchisement and growth: When (1) there exist an economic conflict among the elite, (2) landed classes are not politically strong, and (3) there exists a critical mass of industrial workers, we observe both growth and democratization. The lack of conditions (1) or (2) resolves in stagnant autocracies while the absence of condition (3) drives growth-deterring democratic expansions.

We provide historical support for our argument by analyzing the experience of 11 countries.

The Informational Value of Incumbency

Humberto Llavador et al. — Sun, 13 Apr 2008 12:55:29 PDT

This paper exploits the informational value of incumbency: incumbency confers voters information about governing politicians not available from challengers. We propose a measure of incumbency advantage that improves the use of pure reelection success. We also study the relationship between incumbency advantage, ideological bias and terms in office. Our argument emphasizes that incumbency affects candidates' chances of winning even if they had no opportunity to strategically utilize policies.

An Agenda-Setting Model of Electoral Competition

Josep Colomer et al. — Sun, 13 Apr 2008 12:51:00 PDT

This paper presents a model of electoral competition focusing on the formation of the public agenda. An incumbent government and a challenger party in opposition compete in elections by choosing the issues that will key out their campaigns. Giving salience to an issue implies proposing an innovative policy proposal, alternative to the status-quo. Parties trade off the issues with high salience in voters’ concerns and those with broad agreement on some alternative policy proposal. Each party expects a higher probability of victory if the issue it chooses becomes salient in the voters’ decision. But remarkably, the issues which are considered the most important ones by a majority of voters may not be given salience during the electoral campaign. An incumbent government may survive in spite of its bad policy performance if there is no sufficiently broad agreement on a policy alternative. We illustrate the analytical potential of the model with the case of the United States presidential election in 2004.