The politics of bad policy: Why don’t governments pick win-wins?

Background Why, fundamentally, are the politics and public opinion of ageing and health so badly mis-aligned with facts about the costs of ageing societies? The literature has for decades characteristically divided between an old politics of expansion and the post-1990s new politics of recalibration and austerity. The problem for understanding the politcs of health and ageint is that a mix is also plausible: recalibration with an element of expansion in long term care. This mix then leads to a further thought: When do governments expand mature welfare states to deal with risks not covered in traditional male-wage-earner welfare programs? Methods A narrative review was conducted on the thin literature available attempting to answer the question as to why governments are not picking win-wins (e.g. keep people healthy so they can actually retire at their formal retirement ages, or ensure informal care is valued). Results There were a handful of hypotheses identified in the review, including: the “old politics” of welfare expansion where “credit claiming” is used for highly popular initiatives, the “new politics of the welfare state” also known as the “blame avoidance thesis” where politicians will attempt to avoid blame by making cuts less transparent, “blame buffering” and the “median voter theory” as well as “negative policy feedback”. Conclusions Mature welfare states are not expanding. In fact, the theories on the politics of ageing are focused on how welfare states are retrenching or reforming, as they call it. Blame avoidance and blame buffering are the most common explanations for decisions, often counterproductive ones, about how to recalibrate welfare states in the face of ageing.

Emotional intelligence in a neoclassical framework and the nature of capitalism

Purpose The purpose of this paper is to introduce the factor of emotional intelligence (EI) into the calculus of neoclassical analysis under precautionary saving aiming at stabilizing consumption in the case of an exogenous output shock. Design/methodology/approach The introduction of EI differentiates individual firms in handling production uncertainty and individual consumers in coping with consumption uncertainty, but the source of uncertainty is exogenous and affects all the same; there are no idiosyncratic risks and uncertainties. This in conjunction with the median-voter-theory like approach to agent heterogeneity prompted by EI, replicates the result that aggregates quantitative predictions are almost indistinguishable from their representative agent counterpart in life cycle models of precautionary saving. Findings EI corroborates stabilization greatly but only the introduction of a monetary authority would fully stabilize the system by injecting or withdrawing money depending on the state of the economy. Money becomes centrally issued and it would be destabilizing if it was accompanied by central and/or commercial bank seigniorage. Median EI is found to coincide with homo economicus' rationality. These results point to the importance of preserving the institutional character of capitalism as a free enterprise but also a competitive system under a government in the service of the private sector. Originality/value Methodologically, this paper acknowledges the mutual interdependence between human action and social structure in the liberal setting in which free enterprise is a socioeconomic process that identifies value through exchange under the sociopolitical process of democracy.

Introduction

This chapter opens by providing empirical evidence that income inequality persists or increases in many new democracies after their transition. Then it gives a brief overview of studies that expect reduced inequality because of democratization and questions their three assumptions regarding median voters, party system stability, and the authoritarian legacy on citizen–party linkage. It offers a revision to the median voter theory, emphasizes high electoral volatility in new democracies, and reexamines the legacy of previous nondemocratic regimes on citizen–party linkage. Having offered its argument in a nutshell, it turns to research methodology and case selection. It offers the rationale behind employing a multimethod approach to test its arguments. It tests its argument through large-N analysis in new and longstanding democracies in Europe as well as two paired case studies: Poland and the Czech Republic in postcommunist Europe and Turkey and Spain in Southern Europe.

DESPESAS PÚBLICAS COM SAÚDE E EDUCAÇÃO NOS MUNICÍPIOS DO ESPÍRITO SANTO: uma investigação empírica

Este trabalho buscou verificar os determinantes dos gastos públicos com saúde e educação nos municípios do Espírito Santo, baseando-se na teoria do eleitor mediano. Os dados censitários referem-se ao ano de 2010. Constata que as principais variáveis que explicam as despesas públicas municipais com saúde e educação foram significantes e apresentaram os sinais esperados. Para saúde as principais variáveis foram: preço (tax-price), renda, população, IDH, percentual da população rural e densidade demográfica. Já para educação foram: preço, renda, população, IDH, percentual da população com até 15 anos e densidade demográfica. A elasticidade-preço revelou-se inelástica e a elasticidade-renda estimada permitiu referenciar os bens públicos relacionados à saúde e educação como de caráter normal/superior. Conclui que o coeficiente de congestionamento apresentou valor inferior à unidade, o que demonstra economias de escala a serem exploradas.Palavras-chave: Teoria do eleitor mediano, Despesas públicas, Espírito Santo.PUBLIC EXPENDITURE WITH HEALTH AND EDUCATION IN THE MUNICIPALITIES OF ESPÍRITO SANTO: an empirical investigation Abstract: The objective of this paper was to verify the determinants of public expenditure on health and education in the municipalities of Espírito Santo, based on the median voter theory and the traditional econometric approach. Census data refer to 2010. For health the variables significant were: price (tax-price), income, population, IDH, percentage of rural population and population density. As for education were: price, income, population, IDH, percentage of population aged 15 years and population density. The price elasticity proved to be inelastic and the estimated income elasticity allowed to reference the public goods related to health and education as normal/superior. The coefficient of congestion effect showed a value less than unity both for health and for education, demonstrating the presence of economies of scale to be exploited for these public goods. Key words: The median voter theory, Public expenditure, Espírito Santo.

Demanda por serviços públicos nos municípios do Espírito Santo: uma abordagem empírica

Este trabalho tem como objetivo estimar a demanda por bens públicos municipais no Estado do Espírito Santo, baseando-se na teoria do eleitor mediano. Os dados censitários referem-se ao ano de 2000. Verificou-se que as principais variáveis que explicam as despesas públicas municipais foram significativas e tiveramos sinais esperados, a saber: preço (tax-price), renda e população. A elasticidade-preço mostrou-se inelástica e a elasticidade-renda estimada permite referenciarque os bens públicos locais são essenciais (ou normais). O coeficiente do "efeito congestionamento" apresentou valor inferior à unidade, o que demonstra a presençade economias de escala a serem exploradas para os bens públicos.Demand for local public services of Espírito Santo: an empirical approachAbstract: The object of this paper is to estimate the demand for local public services of Espírito Santo, based on the median voter theory and the traditional econometricapproach. Census data refer to 2000. It was found that the main variables that explain municipal costs were significant and had the expected signs, namely: price (tax-price), income and population. The price elasticity was found to be inelastic and the estimated income elasticity allows reference to the local public goods are essential (or normal). The coefficient of the congestion effect showed a value lessthan unity, demonstrating the presence of economies of scale to be exploited for public goods.Key-words: Espírito Santo; the median voter theory; multiple regression.JEL: C31; H70; H72.