UBC Theses and Dissertations

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UBC Theses and Dissertations

Essays in political economy and on networks Canen, Nathan Joseph


This thesis studies topics in political economy and the economics of networks. In Chapter 2, we present and structurally estimate a model of endogenous network formation and legislative activity of politicians. Employing data on social and legislative effort of members of the 105th-110th U.S. Congresses (1997-2009), we find that there are substantial complementarities between the efforts of politicians, both within and across parties. Chapter 3 considers the econometrics of incomplete information games on networks. This chapter develops a tractable empirical model of linear interactions where each agent, after observing part of his neighbors' types, not knowing the full network of how information is transmitted, uses linear best responses. This allows the researcher to perform asymptotic inference without having to observe all the players in the game or having to know precisely the sampling process. The usefulness of this procedure is shown with an application to the provision of public goods across municipalities in Colombia. Chapter 4 studies the sources of party polarization in the U.S. Congress. Polarization is not just the result of changes in the ideology of individual legislators, but also of changes in the ability of political parties to discipline (whip) their members and of the deliberate agenda setting by their leadership. This chapter evaluates quantitatively the importance of these three components in driving polarization through a novel identification approach based on previously untapped whip count data and a structural model of legislative activity. In the final chapter, I turn my attention to the voters' side in political economy models. Surveys, polling data and media reports indicate that voters often choose whom to vote for at different stages in the political campaign. I develop a model of costly information acquisition that rationalizes these observations. The model implies a key tradeoff between the cost of acquiring information, and the gain such information brings. Under this framework, I show that information blackouts (i.e. forbidding release of campaigning or polling information before the election) generates welfare losses of around 1-2%.

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