Electoral Competition and Endogenous Political Institutions: Quasi-Experimental Evidence from Germany

45 Pages Posted: 11 Apr 2015

See all articles by Mariana Lopes da Fonseca

Mariana Lopes da Fonseca

University of St. Gallen

Thushyanthan Baskaran

University of Goettingen (Göttingen)

Date Written: April 9, 2015

Abstract

Do established parties change political institutions to disadvantage smaller, non-mainstream parties if the latters’ electoral prospects improve? We study this question with a natural experiment from the German federal state of Hesse. The experiment is the abolishment of an explicit electoral threshold (the so called “five percent hurdle”) for local elections in 2001 by the Hessian state parliament. The abolishment improved the electoral prospects of smaller parties at local elections, but local politicians from large mainstream parties had the ability to adjust municipal political institutions in such a way as to counteract the increased competitiveness of smaller parties. One such institutional adjustment is to reduce the size of the local council and thereby raise implicit electoral thresholds. Using a dataset that covers all 426 Hessian municipalities over the period 1989-2011, we document with a difference-indiscontinuity design that municipalities where the electoral competitiveness of smaller parties improved more because of the abolishment of the explicit threshold, reduced their council size more. Hence, established parties appear to erect barriers to entry by adjusting political institutions once new political formations become viable electoral alternatives.

Keywords: Electoral rules, Electoral thresholds, Political competition

JEL Classification: D70, D72, D78

Suggested Citation

Lopes da Fonseca, Mariana and Baskaran, Thushyanthan, Electoral Competition and Endogenous Political Institutions: Quasi-Experimental Evidence from Germany (April 9, 2015). Available at SSRN: https://ssrn.com/abstract=2592506 or http://dx.doi.org/10.2139/ssrn.2592506

Mariana Lopes da Fonseca

University of St. Gallen ( email )

Bodanstrasse 8
SIAW-HSG
St.Gallen, 9000
Switzerland

Thushyanthan Baskaran (Contact Author)

University of Goettingen (Göttingen) ( email )

Platz der Gottinger Sieben 3
Gottingen, D-37073
Germany

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