Political Contracts and Dual Democracy

We investigate whether the combination of incentive contracts for politicians and elections (dual democracy) can help to improve democratic election processes. We examine two types of incentives for politicians: Incentive contracts which make the remuneration of a politician dependent on his political performance and threshold incentive contracts which determine a minimum performance level that a politician has to reach in order to be allowed to run for reelection. In particular, we are concerned with the following issues:

• Can incentive contracts and elections motivate politicians to invest in policies that yield long-term benefits?
• Can incentive contracts help to improve the politicians' effort-allocation across tasks?
• Does the competition of politicians for incentive contracts and elections alleviate inefficient decision-making in politics?
• How can incentive contracts be designed for coalition governments?
• Can a combination of incentive contracts, elections and political information markets be used to generate incentives to invest in long-term policies whose outcomes are not verifiable?

We examine whether the introduction of a dual mechanism of incentive contracts for politicians and democratic elections improve the quality of democratic decision-making.

Publications

• Costs of Change, Political Polarization, and Re-election Hurdles, Journal of Political Economy, 2019, 60.
  (Hans Gersbach, Philippe Muller, and Oriol Tejada)
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• Coalition-preclusion Contracts and Moderate Policies, Games and Economic Behavior, 114, 2019, 28-66.
  (Hans Gersbach, Maik T. Schneider and Oriol Tejada)
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• Higher Bars for Incumbents and Experience, Journal of Theoretical Politics, 29(3), 2017,492-513.
  (Hans Gersbach and Markus Müller)
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• Unraveling Short- and Farsightedness in Politics, Public Choice, 170(3), 2017, 289-321.
  (Hans Gersbach and Oriana Ponta)
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• Government Debt-threshold Contracts, Economic Inquiry, 52(1), 2014, 444-458.
  (Hans Gersbach)
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• On Higher Hurdles for Incumbents, Economics Bulletin, 30(1), 2010, 774-785.
  (Hans Gersbach)
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• Contractual Democracy, Review of Law and Economics, 8(3), 2012.
  (Hans Gersbach)
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• Tax Contracts, Party Bargaining and Government Formation, Mathematical Social Sciences, 64(2), 2012, 173-192.
  (Hans Gersbach and Maik Schneider)
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• Tax Contracts and Elections, European Economic Review, 56(7), 2012, 1461-1479.
  (Hans Gersbach and Maik Schneider)
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• Flexible Pensions for Politicians, Public Choice, 145(1-2), 2010, 103-124.
  (Hans Gersbach and Markus Müller)
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• Power to Youth: Designing Democracy for Long-term Well-being, Mathematical Social Sciences, 58(2), 2009, 158-172.
  (Hans Gersbach and Tobias Kleinschmidt)
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• Competition of Politicians for Wages and Office, Social Choice and Welfare, 33(1), 2009, 51-71.
  (Hans Gersbach)
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• Incentive Contracts and Elections for Politicians with Multi-Task Problems, Journal of Economic Behavior and Organization, 68(2), 2008, 401-411.
  (Hans Gersbach and Verena Liessem)
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• Reelection Thresholds in Politics, Social Choice and Welfare, 31(2), 2008, 233-255.
  (Hans Gersbach and Verena Liessem)
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• Competition of Politicians for Incentive Contracts and Elections, Public Choice, 121(1-2), 2004, 157-177.
  (Hans Gersbach)
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• Incentive Contracts and Elections for Politicians and the Down-Up Problem, in M. Sertel and S. Koray (eds.): Advances in Economic Design, Springer, Berlin, 2003.
  (Hans Gersbach)
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Columns / Policy Briefs

Working Papers

• Download Incentive Pay for Policy-makers?
  (Volker Britz, Afsoon Ebrahimi, and Hans Gersbach)
• Download A Theory of Threshold Contracts
  (Johannes Gerd Becker and Hans Gersbach)
  

Team Members

• Hans Gersbach

Cooperation Partners

• external page Johannes Gerd Becker (ZHAW)
  
• external page Maik T. Schneider (University of Bath)