TY - GEN A1 - Schnellenbach, Jan T1 - Public Entrepreneurship and the Economics of Reform T2 - Journal of Institutional Economics N2 - Public entrepreneurship is commonly understood as the outcome of the activities of a Schumpeterian political innovator. However, empirical research suggests that changes to a more efficient economic policy, even if it is known and technically easy to implement, are usually delayed. This is difficult to reconcile with Schumpeterian notions of public entrepreneurship. In this paper, it is argued that the attempt to transfer a Schumpeterian approach to the public sector is fundamentally flawed. Institutional checks and balances that characterise most modern liberal democracies make the strategy of bold leadership an unlikely choice for an incumbent. If change occurs, it occurs normally as a response to the fact that the status quo has become untenable. From a normative point of view, it is argued that if public entrepreneurship nevertheless occurs, it will often be associated with unwanted consequences. A dismantling of formal institutional checks and balances is therefore not reasonable. KW - public entrepreneurship KW - political innovation KW - reform processes KW - Schumpeterian political economy Y1 - 2007 U6 - https://doi.org/10.1017/S1744137407000641 SN - 1744-1382 VL - 3 IS - 2 SP - 183 EP - 202 ER - TY - GEN A1 - Schnellenbach, Jan T1 - Rational Ignorance Is Not Bliss: When Do Lazy Voters Learn from Decentralised Political Experiments? T2 - Journal of Economics and Statistics N2 - A popular argument about economic policy under uncertainty states that decentralisation offers the possibility to learn from local or regional policy experiments. Often, an analogy between market competition as a discovery procedure and political competition is used to corroborate this argument. We argue that political learning processes are not trivial and do not occur frictionlessly: Voters have an inherent tendency to retain a given stock of policy-related knowledge which was costly to accumulate, so that yardstick competition is improbable to function well particularly for complex issues, if representatives' actions are tightly controlled by the electorate. We show that factor mobility does have the potential to endogenously disturb equilibria on regional markets for political theories, and therefore does provide for improved political learning processes compared to unitary systems. But the results we can expect are far from the ideal mechanisms of producing and utilising knowledge often described in the literature. In particular, collective learning may occur in the relatively efficient region, while the status quo may be fortified in the relatively inefficient region. KW - Policy decentralisation KW - fiscal competition KW - model uncertainty KW - collective learning Y1 - 2008 U6 - https://doi.org/10.2139/ssrn.990268 SN - 0021-4027 VL - 228 IS - 4 SP - 372 EP - 393 ER - TY - GEN A1 - Feld, Lars P. A1 - Schaltegger, Christoph A. A1 - Schnellenbach, Jan T1 - On Government Centralisation and Budget Referendums: Evidence from Switzerland T2 - European Economic Review N2 - Several authors have argued that a centralization of fiscal powers in a federation is less likely to occur if citizens have to approve a change in the assignments of responsibilities by a popular referendum. This outcome may be due to the fact that logrolling is more difficult under direct than under representative democracy. It may also be caused by citizens’ fear that a centralization of fiscal authority facilitates the extraction of rents by the government or the legislature. In this paper, we test the hypothesis that centralization is less likely under referendum decision-making in the unique institutional setting of Switzerland. Using a panel of Swiss cantons from 1980 to 1998, the empirical analysis provides evidence that referendums induce less centralization of fiscal activities. KW - Centralization KW - Fiscal federalism KW - Fiscal referendums Y1 - 2008 U6 - https://doi.org/10.1016/j.euroecorev.2007.05.005 SN - 1873-572X VL - 52 IS - 4 SP - 611 EP - 645 ER - TY - GEN A1 - Schnellenbach, Jan A1 - Feld, Lars P. A1 - Schaltegger, Christoph A. T1 - The Impact of Referendums on the Centralization of Public Goods Provision: A Political Economy Approach T2 - Economics of Governance N2 - The paper compares decision-making on the centralisation of public goods provision in the presence of regional externalities under representative and direct democratic institutions. A model with two regions, two public goods and regional spillovers is developed in which uncertainty over the true preferences of candidates makes strategic delegation impossible. Instead, it is shown that the existence of rent extraction by delegates alone suffices to make cooperative centralisation more likely through representative democracy. In the non-cooperative case, the more extensive possibilities for institutional design under representative democracy increase the likelihood of centralisation. Direct democracy may thus be interpreted as a federalism-preserving institution. KW - Centralisation KW - Direct democracy KW - Representative democracy KW - Public good provision Y1 - 2010 U6 - https://doi.org/10.1007/s10101-009-0063-1 SN - 1435-8131 VL - 11 IS - 1 SP - 3 EP - 26 ER - TY - GEN A1 - Pitsoulis, Athanassios A1 - Schnellenbach, Jan T1 - On Property Rights and Incentives in Academic Publishing T2 - Research Policy N2 - The peer review system in academic publishing performs two important functions by screening a manuscript for its quality, and by helping to further improve an author's work. However, it often fails to perform these functions in a satisfactory manner. We argue that property rights theory can be fruitfully applied to understand these shortcomings, and to develop reform proposals. The present paper discusses the incentive-problems in journal peer review from an institutional economics perspective, arguing that the incentives of both authors and reviewers to fully exploit a manuscript's potential depend on their property rights. Based on this theory of peer review, we argue that the recent proposal of an “as is” review policy combined with increased accountability of referees can be expected to result in a higher efficiency of peer review. KW - Academic journals KW - Scientific publishing KW - Peer review policy KW - Property rights Y1 - 2012 U6 - https://doi.org/10.1016/j.respol.2012.03.005 SN - 0048-7333 VL - 41 IS - 8 SP - 1440 EP - 1447 ER - TY - GEN A1 - Schnellenbach, Jan T1 - The Economics of Taxing Net Wealth: A Survey of the Issues T2 - Public Finance and Management N2 - This paper surveys possible motivations for having a net wealth tax. After giving a short overview over the state of wealth taxation in OECD countries, we discuss both popular arguments for such a tax, as well as economic arguments. It is argued that classical normative principles of taxation known from public economics cannot give a sound justification for a net wealth tax. The efficiency-related effects are also discussed and shown to be theoretically ambiguous, while empirical evidence hints at a negative effect on GDP growth. Finally, it is argued that despite of widespread and persistent lobbying for a revitalization of the net wealth tax, this is unlikely to happen due to political economy constraints. KW - net wealth tax KW - wealth KW - inequality KW - redistribution Y1 - 2012 SN - 1523-9721 VL - 12 IS - 4 SP - 368 EP - 400 ER - TY - GEN A1 - Bjørnskov, Christian A1 - Dreher, Axel A1 - Fischer, Justina A1 - Schnellenbach, Jan A1 - Gehring, Kai T1 - Inequality and Happiness: When Perceived Social Mobility and Economic Reality Do Not Match T2 - Journal of Economic Behavior & Organization N2 - We argue that perceived fairness of the income generation process affects the association between income inequality and subjective well-being, and that there are systematic differences in this regard between countries that are characterized by a high or, respectively, low level of actual fairness. Using a simple model of individual labor market participation under uncertainty, we predict that high levels of perceived fairness cause higher levels of individual welfare, and lower support for income redistribution. Income inequality is predicted to have a more favorable impact on subjective well-being for individuals with high fairness perceptions. This relationship is predicted to be stronger in societies that are characterized by low actual fairness. Using data on subjective well-being and a broad set of fairness measures from a pseudo micro-panel from the WVS over the 1990–2008 period, we find strong support for the negative (positive) association between fairness perceptions and the demand for more equal incomes (subjective well-being). We also find strong empirical support for the predicted differences in individual tolerance for income inequality, and the predicted influence of actual fairness. KW - Happiness KW - Life satisfaction KW - Subjective well-being KW - Inequality KW - Income distribution KW - Redistribution KW - Political ideology KW - Justice KW - Fairness KW - World Values Survey Y1 - 2013 U6 - https://doi.org/10.1016/j.jebo.2013.03.017 SN - 0167-2681 VL - 91 SP - 75 EP - 92 ER - TY - GEN A1 - Feld, Lars P. A1 - Schnellenbach, Jan T1 - Political Institutions and Income (Re-)Distribution: Evidence from Developed Economies T2 - Public Choice N2 - We discuss the effect of formal political institutions (electoral systems, fiscal decentralization, presidential and parliamentary regimes) on the extent and direction of income (re-)distribution. Empirical evidence is presented for a large sample of 70 economies and a panel of 13 OECD countries between 1981 and 1998. The evidence indicates that presidential regimes are associated with a less equal distribution of disposable incomes, while electoral systems have no significant effects. Fiscal competition is associated with less income redistribution and a less equal distribution of disposable incomes, but also with a more equal primary income distribution. Our evidence also is in line with earlier empirical contributions that find a positive relationship between trade openness and equality in primary and disposable incomes, as well as the overall redistributive effort. KW - Redistribution KW - Formal institutions KW - Fiscal decentralization KW - Presidential and parliamentary regimes KW - Electoral systems Y1 - 2014 U6 - https://doi.org/10.1007/s11127-013-0116-4 SN - 1573-7101 VL - 159 IS - 3 SP - 435 EP - 455 ER - TY - GEN A1 - Schnellenbach, Jan T1 - Neuer Paternalismus und individuelle Rationalität: eine ordnungsökonomische Perspektive T2 - List-Forum für Wirtschafts- und Finanzpolitik N2 - In den letzten Jahren hat sich ein breiter Literatur strang etabliert, der neue Formen paternalistischer Interventionen vorschl ägt, um individuelle Entscheidungen zu verbessern, die nicht vollständig rational sind. Di e Motivation hierfür liegt in zahlreichen Verhaltensanomalien und anderen Abweichungen vom Mo dell vollständiger Rationalität, die von der empirischen Verhaltensökonomik identifizier t wurden. Der neue Paternalismus zeichnet sich nach seinen Befürwortern dadurch aus, dass er ‘libertär’ ist, da die betroffenen Individuen in die als effizient erachtete Richtung geschubst, aber nicht gezwungen werden. Die Möglichkeit zu abweichendem Verhalten soll grun dsätzlich erhalten bleiben. In diesem Papier wird der neue Paternalismus aus einer ordnung sökonomischen Perspektive untersucht. Es wird gezeigt, dass wichtige Varianten des neuen Paternalismus mit den ordnungsökonomischen Steuerungsidealen der Konsumen tensouveränität und der Bürgersouveränität kollidieren. KW - Paternalismus KW - Ordnungsökonomik KW - Verhaltensökonomik Y1 - 2014 SN - 0937-0862 VL - 40 IS - 3 SP - 239 EP - 257 ER - TY - GEN A1 - Schnellenbach, Jan T1 - Does Classical Liberalism Imply an Evolutionary Approach to Policy-Making? T2 - Journal of Bioeconomics N2 - This paper argues that an evolutionary approach to policy-making, which emphasizes openness to change and political variety, is particularly compatible with the central tenets of classical liberalism. The chief reasons are that classical liberalism acknowledges the ubiquity of uncertainty, as well as heterogeneity in preferences and beliefs, and generally embraces gradual social and economic change that arises from accidental variation rather than deliberate, large-scale planning. In contrast, our arguments cast doubt on a different claim, namely that classical liberalism is particularly compatible with the evolutionary biological heritage of humans. KW - Classical liberalism KW - Evolution KW - Darwinism KW - Economic policy KW - Cultural evolution KW - Institutional evolution Y1 - 2015 U6 - https://doi.org/10.1007/s10818-014-9188-6 SN - 1573-698 VL - 17 IS - 1 SP - 53 EP - 70 ER -