Using game-theoretic models, I study how political actors can push their agendas forward through the manipulation of voters' beliefs about key underlying parameters. You can read more about my research on my website: https://www.arduinotomasi.com/.
Merchants of Reputation: Privatization under Elites' Outside Lobbying
An elite is interested in purchasing a public asset, whose control is within the authority of a re-election and legacy concerned incumbent politician. The elite not only wants to buy the asset, but wants to buy it cheap. In the extensive margin, the incumbent decides whether to sell or not; in the intensive margin, he decides at what price to sell. The main contribution of the paper is to uncover how the intensive margin creates an incentive for the elite to invest in outside lobbying ex-ante so as to get the asset as cheap as possible. In my framework, outside lobbying is the elite's use of their media to attack or to threaten the incumbent: they can affect his electoral fortunes by manipulating voter's beliefs about his competence. I show that the elite's optimal lobbying strategies take two broad forms on the equilibrium path: if the incumbent is unwilling to privatize, then the elite employs threats; if he is willing to privatize, the elite employs attacks. The paper shows that even in the absence of traditionally studied channels of influence (like bribery), the elite can induce significant variability in the asset sale prices: equilibrium strategies can be non-monotonic, which induces non-monotonicity of prices. Both the outside lobbying strategies and the privatization prices emerge endogenously in equilibrium.
Programmatic Transfers and the Political Control of Information Effects
Why do politicians use programmatic transfers? I study an electoral accountability model in which an office and legacy motivated incumbent politician, who can be of high or low competence, has to allocate a budget between transfers and public goods. Transfers are "programmatic" in that although along the intensive margin he has discretion to set the per-capita transfer, along the extensive margin only an income threshold determines eligibility. In my framework, engaging in transfers is not only less efficient than public goods provision but it is also an easier task —which results in transfers being less informative about the incumbent's competence. I show that an incumbent's electoral status with respect to his challenger determines his preferences over the budget allocation: when he is leading, he has incentives to shut-down his governance's informativeness through transfers, trading-off re-election for legacy-building today; and when he is trailing, increasing his governance's informativeness through public goods provision allows him to build a legacy today and opens the door to re-election. Perhaps surprisingly, the incumbent can also have incentives to trade-off policy authority to increase his electoral prospects: by designing a long-term transfers program and, thereby, tying the hands of the next office-holder, he can endogenously manipulate the weight that voters place on political selection. The theoretical implication for empirical models is that to isolate the causal effect of programmatic transfers on vote shares, the experimental ideal is not simply to randomize the cash, but the availability of the policy instrument itself. Finally, I argue that by uncovering the correct counterfactual specification, the model can be useful to make sense of the existing mixed causal evidence.