Strategic Ambiguity, Campaign Contributions and Candidate Location Alberto Alesina and Richard Holden September 2007
Abstract We analyze a model in which voters are uncertain about the policy preferences of candidates.
Two forces a¤ect the probability of electoral success: proximity to the
median voter and campaign contributions. We show that campaign contributions may have no equilibrium e¤ect on electoral success, despite having large out of equilibrium e¤ects.
Moreover, candidates may wish to announce a range of policy preferences,
rather than a single point. This strategic ambiguity balances voter beliefs about the appeal of candidates both to the median voter and campaign contributors.
Preliminary and incomplete. Alesina: Harvard University, Department of Economics. email:
[email protected]. Holden: Massachusetts Institute of Technology, Sloan School of Management. E52-410, 50 Memorial Drive Cambridge MA 02142. email:
[email protected].
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1
Introduction
The standard two candidate model of electoral competition has two key implications: convergence to the ideal policy of the median voter, and unambiguous (i.e clear and precise) policy platforms.
Convergence to the median is complete in a Downsian (Downs (1957))
model in which the two candidates care only about winning elections. Convergence is partial in a “partisan” model in which the candidates care about policy per se (Wittman (1983), Calvert (1985)), and can make a commitment to their electoral platforms1 . Partial convergence means that the two candidates propose policies (much) closer to each other than their ideal ones. As for ambiguity, Shepsle (1972) shows that with risk averse voters the candidates have an interest in being as clear as possible in announcing their welfare maximizing policy. Any uncertainty about their policy platform would a¤ect the parties’negatively in the eyes of risk averse voters. The observed patterns of real world elections in two party systems seem rather far from the implications of these basic models. For instance no commentators of recent American presidential elections would argue that the two parties have moved closer to each other; on the contrary casual observation suggests that extreme groups are quite in‡uential in both parties and presidential candidates have taken increasingly polarized positions. McCarty, Poole and Rosenthal (2006) present a swathe of evidence on the evolution of polarization in the United States and its large recent increase. Speaking of convergence in American politics today seems completely out of touch with reality. In the recent (2007) French presidential election the two candidates took positions very far from each other and showed no interest in converging, not even in words. Even less plausible is the implication that candidates are unambiguous in their pre-electoral policy statements. Just the opposite: most candidates are very careful in not taking clear positions on key issues or even changing their position when useful. Often, speaking in front of di¤erent audiences the same candidates make rather di¤erent statements on the same policy issue. One Republican presidential nominee in the 1
See Alesina and Rosenthal (1995) and the references cited therein for a review of these models.
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2008 campaign (John McCain) accused another one (Mitt Romney) of changing his views on abortion every even numbered year. One Democratic nominee (Hillary Clinton) has been as ambiguous as one can possibly be on her votes and views about the Iraq war.
If the
candidates wanted to be unambiguous they could easily do a much better job at it! In a sense, extremism and ambiguity seems somewhat contradictory: and in fact the dance over this trade-o¤ between trying to appeal to many voters and taking extreme positions (close to the views of extreme groups) does appear as a feature of recent presidential elections in the United States. We propose a model in which candidate may adopt policy platforms even more extreme than their ideal policies and in addition would choose to be ambiguous. More precisely, in equilibrium, the candidates may o¤er voters an ideological interval space within which they position their platforms, but they purposely do not reveal which policy they stand for (and will implement if elected) within that interval. In the model we combine four elements: …rst, partisan preferences of candidates, namely candidates have ideal policies that they would like to implement; second, uncertainty about the true ideal policies of the candidates; third, uncertainty about the distribution of voters preferences, and speci…cally about the position of the median voter; fourth, campaign contributions that, holding everything else constant a¤ect the probability of victory by in‡uencing the views of the median voter. Ambiguity of platforms emerge in equilibrium as a result of the candidates balancing two forces: the need to converge towards the median and the need to raise contributions that may ‡ow from groups to the extreme of the ideological spectrum (and “feel strongly”about certain issues). For the sake of argument we can think of contributions as “money” but they an also take the form of unpaid time of activists, union strikes (mainly in a non US context) and the like. Extremism arises when the e¤ect of campaign contributions from extreme groups dominate the gain in probability of winning from convergence to the median voter.
In an attempt to
gain contributions without loosing too many voters in the middle of the political spectrum the candidates may choose to be ambiguous regarding their policy stand even though everybody,
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contributors and voters are aware of this incentives. Obviously, ex ante uncertainty about the true ideal policy of the candidates is crucial for this result on ambiguity of platforms. Note that, like in an arms race or in advertising, in equilibrium campaign contributions may not a¤ect the probability of victory of the two candidates, even though they would a¤ect their choice of policy, making them more extreme We can parametrize the extent (of lack thereof) of ambiguity (i.e. the size of the ideological interval o¤ered by candidates) and the degree of convergence as a function of parameters that can be easily interpreted such as the distribution of voter preferences, the amount of uncertainty about the position of the median voter, the marginal e¤ect of campaign contribution on electoral outcomes, the distance of parties’ideal policies, and their symmetry or asymmetry relative to the median voter’s ideal policy, and the importance of o¢ ce holding rents.
Therefore the paper can also explain
how the evolution over time of certain parameters, like for instance the importance and role of contributions may a¤ect the equilibrium even holding constant the ex ante (i.e. before contributions) distribution of voters’preferences. Many before us have noted the inability of simple “traditional” models to explain the richness of diverse observations o¤ered by electoral contests. The issue of (lack of convergence) has been attributed to the inability of making commitments to moderate pre electoral platforms (Alesina (1988)) but this model would imply convergence in a repeated game and is not compatible with parties taking positions even more extreme than their ideal policies. Alesina and Rosenthal (2000) discuss extremism of presidential candidates when facing an adverse Congress, an issue which we do not address here. Glaeser, Ponzetto and Shapiro (2005) derive the adoption of extreme policies from the incentive that parties have to get people to vote. Extremists vote only if the policies propose to them are not too middle of the road.
Campante (2007) presents a model in which campaign contributions in‡uence
how much parties choose to redistribute and presents evidence consistent with the fact that more polarization in the population lead to more contributions which polarize parties’policies. McCarty, Poole and Rosenthal (2006) discuss the importance of contributors to the
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increased polarization of American politics and relate both of them to the increased inequality. They show that both contributions from Political Action Committees (PACs) and soft money from individuals are highly ideological. In particular, soft money comes from extremists and its importance has risen recently.2 On ambiguity, Alesina and Cukierman (1990) present a model in which an incumbent in o¢ ce has an interest in introducing noise so as not to allow the voters to learn his ideal policy by observing his policies perfectly while in o¢ ce. In that model, however, only the incumbent can be ambiguous: there is no strategic game in platforms. Several papers discuss the choice of policy (especially monetary policy) in situation where the public does not know the type of policymakers, but these are not models of electoral competition.3 The paper is organized as follows. Section 2 presents the basic model without uncertainty about candidates’ ideal policies but with contribution. This part of the model delivers contributions driven extremism. Section 3 derives ambiguity of candidates’platforms, that is we illustrate the possibility that candidates choose a (possibly large) interval in the issue line rather than a single point. Section 4 discusses extensions, applications and limitations of the model and the last section concludes. All proofs are in the appendix.
2
The Model
2.1
The Basic Setup
Consider two candidates who have to choose a binding electoral platform on the ideological (policy) space de…ned by the unit interval [0; 1] : The “left-wing”candidate (player X) has a policy bliss point xb 2 [0; 1=2] and the “right-wing”candidate (player Y ) has a policy bliss point yb 2 [1=2; 1] : Simultaneously and non-cooperatively player X chooses location x and player Y chooses location y: For now we will take x and y to be real numbers (i.e. points) 2 3
See these authors for a more complete review of the political science literature on this issue. See Persson and Tabellini (2002) for a survey.
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on the unit interval, but later we will allow them to be sub-intervals.
Denoting p as the
probability that candidate x wins the election we assume that the preferences of player X can be represented by the utility function
UX =
p (x
xb )2
(1
p) (y
xb )2 :
p) (y
y)2
p (x
yb )2 :
Similarly for player Y we have
UY =
(1
Electoral outcomes–encapsulated by the probability p–are determined by two forces. One is the distribution of voter preferences and the position of the median voter.
Suppose
that voter i has a single-peaked symmetric concave utility function with bliss point ib . For concreteness assume that voters have a quadratic utility function like the candidates so the utility of voter i is
Ui =
E(t
ib )2
where t is the policy implemented and the expectation sign highlights the possibility that the voter is not sure about which candidate will prevail. With this utility function a dominant strategy for each voter is to vote for the candidate o¤ering the policy closer to ib : The distribution of the bliss points determines the number of votes received by the candidates for each pair of policy proposed.4 The median voter is expected to have a bliss point at 1=2; but there is an aggregate shock to voter preferences which makes the location of the median voter stochastic. This shock is uniformly distributed on the interval ["; "] ; and we parameterize the magnitude 4
Obviously with no uncertainty about voter preferences for each pair of platforms chosen one party would win for sure, the one with a policy proposal closer to the median. In this case the only equilibrium is one in which both candidates position themselves at the media and the probability of victory is 1=2:
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of the shock by assuming that " analysis we will assume that
" = 1=
with
2 (1; 1) : Throughout much of the
= 2; to ensure that certain regularity conditions are satis…ed.
This is largely a technical assumption, but we will discuss it in more detail below.
The
second force is the e¤ect of campaign contributions. We assume that there is a contribution maximizing point for each candidate: 0 for candidate X and 1 for candidate Y: This is an extreme assumption which is meant to capture the idea that those who contribute are groups with strong ideological views who are trying to pull candidates away from the middle of the political spectrum. We discuss this assumption in more detail below, but the fact that the contribution maximizing point are the actual extreme of the ideological space is a simpli…cation: it is enough that the contribution maximizing points are more extreme that the parties’ideal points to obtain all of our results, as it will become clear below. We model the e¤ect of contributions as a force that moves the median voter (in expectation) closer to the candidate that gets the larger relative contributions. The interpretation is that contributions allow parties to invest in advertising and persuasion of voters, moving undecided voters toward their side5 . More speci…cally, the distance from the candidate location relative to the contribution maximizing point a¤ects " and ": As candidate X moves toward the contribution maximizing point relative to candidate Y; " moves down while "
"
remains constant. This is represented in the following formula for "
"=
1 2
1 2
+ 1
1 1 + 2 2
(1
y
x) :
thus parameterizes the importance of campaign contributions. When
= 0 there is
no e¤ect of campaign contributions, and the size of the e¤ect is increasing in : In words the candidate that is closer to his contribution maximizing point manages to move to expected median voter towards his side. Given our distributional assumptions (and assuming that x 5
See Alesina and Tabellini (2007) for a similar way of modelling the e¤ects of campaign contributions.
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and y are known) the probability that candidate X wins the election is:
Pr (X wins) = Pr (" =
2.2
x+y 2
x
