Party Competition and Local Spending Decisions

Abstract

Party competition is central to the operation of representative democracy. Just as competition between firms in private markets is supposed to ensure the efficient provision of services required by consumers, so competition between parties delivers the policies desired by the electorate. As Elkins argues, party competition implies that governments ‘will not be self perpetuating and that elections can, and in some cases do, lead to the replacement of one set of officials with another set. The chance, or probability, of turnover is perhaps the most salient feature of this system of accountability’ If competition works then the ruling party is fearful of loss of office and seeks to produce policies that satisfy the electorate. Correspondingly, opposition parties will adopt a platform which is intended to be more popular than that of the incumbents. This, in essence, is the Downs model of party behaviour in a representative democracy: the struggle for electoral support leads rival parties to adopt ‘moderate’ policies that reflect median voter preferences. In the absence of competition, the ruling party would be free to neglect public opinion and pursue ‘extreme’ policies in line with the views of its activists or financial backers.D. Elkins, ‘The Measurement of Party Competition’, American Political Science Review, 68 (1974), 682–700, p. 682.A. Downs, An Economic Theory of Democracy (New York: Harper & Row, 1957).D. Robertson, A Theory of Party Competition (London: Wiley, 1976).