Wooing the Voters: Economic Performance and Regime Change

Gopal K. Basak, Diganta Mukherjee
2011 Social Science Research Network  
When outcomes of developmental projects undertaken are uncertain, ruling parties in a democracy often face a difficult choice. Taking up projects that fail result in bad publicity and hence a dent in the vote bank. But on the other hand a successful project leads to more votes as well as more money in the funds for the ruling party. In the context of a two party model of democracy with neutrals and supporters, we set up a dynamic stochastic model to explore this situation. Using numerical
more » ... s, we show that the rate of failure of projects play a crucial role in changing the probability of a reelection. We also explore the role of other factors like rate of project arrival, party loyalty and changeover probability. The results indicate that in a strategic setting, in some situations, the ruling party would be better off by ensuring a low rate of project arrival to increase their chances of reelection. This has interesting implications for addressing the development vs. political stability conundrum.
doi:10.2139/ssrn.2179800 fatcat:c5uw7zqlezgq7dtyzdb5irbjpa