Conference Agenda

Overview and details of the sessions of this online conference.

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Session Overview
K02: Politics and Elections
Friday, 20/Aug/2021:
12:30pm - 2:00pm

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12:30pm - 12:52pm

Bayesian Persuasion in Tax Competition

Erkin Sagiev

University of Essex, United Kingdom

Multinational enterprises form long value chains linking subsidiaries in a large number of countries. The latter may provide tax preferences distorting a fair distribution of profit between the subsidiaries. Such a support of profit shifting is elusive for other countries, because no government has a complete view of the global business activity. Hence, truthful communication becomes a chief concern in counteraction to harmful tax competition. To investigate this issue we model intergovernmental information exchange as sequential Bayesian persuasion. We demonstrate how communication promotes tax avoidance through a chain structure and show how countries take their roles in profit shifting schemes. The key outcome is that formal information exchange agreements do not prevent profit shifting but change its beneficiaries. We also argue that, zero-tax rate is not a distinct feature of the countries assisting tax avoidance, as we reveal the reasons for the coexistence of offshore financial centres with tax harbours.

Sagiev-Bayesian Persuasion in Tax Competition-297.pdf

12:52pm - 1:15pm

Political Devaluation? Lessons from Emancipating Women in Politics

Anna Koukal1,2, Stephanie Fürer1,2, Jonathan Massonnets1,2

1University of Fribourg; 2Swiss Distance University Institut

In the last century, women conquered both many professions and the political sphere. However, research on the effects of feminization has mainly focused on labor market outcomes. According to the devaluation hypothesis, professions experiencing an inflow of female workers are devalued in pay and status because of the lower value attributed to women's work. Analyzing the staggered introduction of female enfranchisement in Switzerland, we find a similar pattern for the political sphere. Our results provides evidence that men attach less value to politics after women enter the political sphere, resulting in a drop of male voter turnout by around 2 percentage points in elections and around 4 percentage point in referendums. This effect is more pronounced under direct democracy and in an environment initially opposing female enfranchisement.

Koukal-Political Devaluation Lessons from Emancipating Women-412.pdf

1:15pm - 1:37pm

1 Political Cycles and Yardstick Competition in the Recycling of Waste. Evidence from Italian Provinces

Massimiliano Ferraresi1, Massimiliano Mazzanti2, Matteo Mazzarano2, Leonzio Rizzo2, Riccardo Secomandi2

1European Commission, Joint Research Centre (JRC); 2University of Ferrara

Recycling and the recovery of waste are crucial waste management strategies. In light of the new EU circular economy approach, these strategies remain core pillars of a competitive and sustainable waste value chain. Local governments have an important role in controlling and checking the implementation of waste management policies. We study the spatial determinants of waste recovery by using a dataset of 102 Italian provinces from the years 2001-2014. We exploit the political cycle of the provinces to isolate the effects of waste recovery in one province on neighboring provinces. We find that provinces mimic their own neighbors’ in the separate collection of waste aimed at recycling and recovery, with this effect being fully guided by provinces where the president can run for re-election but only when waste management policies become politically salient, that is, after the transposition of the 2008 EU Waste Framework Directive.

Ferraresi-1 Political Cycles and Yardstick Competition in the Recycling-400.pdf

1:37pm - 2:00pm

Blaming Migrants Doesn’t (Always) Pay: The Political Effects Of Immigration During A Pandemic

Boldrini Michela1, Pierluigi Conzo2, Roberto Zotti3

1University of Torino, Italy; 2University of Torino & Collegio Carlo Alberto, Italy; 3University of Torino, Italy

The paper studies the political effects of the Ebola outbreak in 2014 on local electoral competitions in Italy, exploiting the exogeneity of the virus to the Italian socio-political and economic context. Despite the very limited number of actual Ebola cases in Italy, the outbreak of Ebola caused a major public reaction. We exploit two sources of exogenous variation, i.e. refugee landings and the year of local elections. We create a measure of exposure that varies over time and across municipalities depending on the local share of immigrants having the same nationality as the refugees arrived at Italian ports in a given year and use it in a Difference-in-Differences approach with a continuous treatment. Consistent with ‘rally round the flag’ hypothesis, we find that risk-Ebola immigration reduced the political consensus to radical and populist parties, while it increased the likelihood that incumbents were re-elected.

Michela-Blaming Migrants Doesn’t-484.pdf

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