This Paper analyses an overlapping generation model of public good provision under repeated voting. The public good is financed through age-dependent taxation that distorts human capital investment. Taxes redistribute income both across different skill groups and across generations. We contrast...

Many collective decision problems have the common feature that individuals' desired outcomes are correlated but not identical. This Paper studies collective decisions with private information about these desired policies. Each agent holds private information that mainly concerns their own bliss...

We study political activism by several agents (lobbyists, unions, etc.) who have private but imperfect policy-relevant signals, and seek to influence the decisions of a policy maker. When agents can share information and coordinate their actions, the equilibrium is shown to be equivalent to that...

Politicians frequently undertake projects whose budgetary costs are disproportionate to the benefits they create for the voters or shareholders those decision-makers represent. When they are not the result of simple random mistakes, such wasteful projects are often attributed to weak mechanisms...

In this Paper, we study the role of subsidies to fertility in ensuring the political viability of unfunded social security (SS). In our model, agents are heterogeneous in age and income. Young generations confront promises made previously by older generations, and in turn choose current levels...

Whereas a political budget cycle was once thought to be a phenomenon of less-developed economies, some recent studies find such a cycle in a large cross-section of both developed and developing countries. We find that this result is driven by the experience of ‘new democracies’, where fiscal...

Inspired by the current debate over the future of the monetary union in Europe, this paper provides a simple model for the determination of the conditions of survival of the common good, which requires the creation of an effective fiscal union. We highlight the importance of institutional design...

Much literature on political behavior treats politicians as motivated by reelection, choosing actions to signal their types to voters. We identify two novel implications of models in which signalling incentives are important. First, because incumbents only care about clearing a reelection...

We study the effects of unequal representation in the interest-group system on the degree of information transmission between a lobbyist and a policy-maker. Employing a dynamic cheap-talk model in which the lobbyist cares instrumentally about his reputation for truth telling, we show that the...