Incumbency (dis)advantage when citizens can propose

Abstract

This paper analyses the problem that an incumbent faces during the legislature when deciding how to react to citizen proposals such as the outcome of referenda or popular initiatives. We argue that these proposals constitute a potential source of electoral disadvantage when citizens factor in their evaluation of the incumbent his reaction to these proposals. This is because an incumbent politician may jeopardize his re-election by implementing policies close to his preferred ones but unpopular among the electorate. We characterize conditions under which this potential disadvantage becomes in fact an electoral advantage for the incumbent. We find that the choices of the incumbent during the legislature will be closest to citizens policy proposals when the intensity of electoral competition is neither too soft nor too tough. Finally, we use our results to discuss some implications of the use of mechanisms such as referenda and popular assemblies on electoral competition and on the incumbency advantage phenomenon.