Do the Right Thing. A Comparison of Politicians' Incentives Across Constitutional Systems

Abstract

Constitutional structures shape politicians' behaviour and hence policy outcomes through the di fferent incentive schemes at work. In this paper we analyse these mechanisms in parliamentary and presidential systems. Such a comparison is carried over by analysing how the two systems are able to select the effi cient policy in presence of asymmetric information. The constitutional structures di ffer in that the policy proposal in parliamentary democracies is observable and confi dence-dependent. The main findings suggest that the parliament responds to the incentive scheme better in presidential systems due to less uncertainty that legislators face over their term limit. However, the parliamentary system induces the executive to behave more e fficiently due to selection and disciplining e ffects.