Table of Contents
Chapter 1: Who Gets What and Why? The Politics of Particularistic Economic Policies
Governments' willingness to selectively target economic benefits, like subsidies to businesses, depends on the way politicians are elected and the geographic distribution of economic activities. Electoral institutions interact with economic geography to influence countries' economic policies and international economic relations.
Chapter 2: The Uneven Geographic Dispersion of Economic Activity
One of the most striking features of modern economies is the uneven distribution of economic activity. Activities, such as production and employment, are unevenly distributed across space. In this chapter, I explore the concept of economic geography: what it is, why does it vary, and how might it matter for politics?
Chapter 3: How Institutions and Geography Work Together to Shape Policy
In this chapter, I discuss the mechanisms through which economic geography and electoral institutions work to shape leaders’ policy incentives, notably effective vote maximization and the nature of electoral competition. I also discuss possible alternative mechanisms including government partisanship, factor mobility, party discipline, and electoral competitiveness.
Chapter 4: Explaining Government Spending on Industrial Subsidies
Subsidies for the manufacturing sector constitute a larger share of government expenditures in countries with plurality electoral systems than in countries with proportional systems when manufacturing employment is geographically concentrated. When manufacturing employment is geographically diffuse, governments in proportional systems assign relatively more of their budgets to manufacturing subsidies than governments in plurality systems, holding all else equal.
Chapter 5: The Power of Producers: Successful Demands for State Aid
Two violations of European Union rules on State Aid are examined in this chapter: a program to support Cognac producers in France and a subsidy for Austrian wine makers. The two subsidy programs exhibit different characteristics because of the respective countries’ electoral institutions and economic geography. Countries’ electoral institutions and economic geography influence the likelihood of governments’ compliance with EU state aid rules.
Chapter 6: Why Institutional Differences among Proportional Representation Systems Matter
Among proportional systems, spending on subsidies for diffuse groups is higher in closed list systems, where voters select a party at the ballot box, as compared to open list systems where voters to select individual candidates from a party’s list. The most generous subsidies in PR systems occur in open-list systems with high mean district magnitude and geographically concentrated groups.
Chapter 7: The Policy Effects of Electoral Competitiveness in Closed-List PR
The generosity of government-funded subsidies varies between electoral districts in an archetypal proportional system: Norway. Parties target subsidies to districts where they have relatively more supporters. Qualitative evidence from interviews of government ministers and bureaucrats responsible for the administration of Norway's subsidy programs confirm the importance of electoral politics and economic geography for governments’ spending decisions.
Chapter 8: Conclusion and Implications
My argument suggests a solution to the debate over which democratic institutions make politicians most responsive to special interests, namely economic geography. My argument also adds an important element to neo-institutional theories in political science by demonstrating that it matters not only what voters want from government but also where they are located.