Optimal Timing of Policy Announcements in Dynamic Election Campaigns*

We construct a dynamic model of election campaigns. In the model, opportunities for candidates to refine/clarify their policy positions are limited and arrive stochastically along the course of the campaign until the predetermined election date. We show that this simple friction leads to rich and subtle campaign dynamics. We first demonstrate these effects in a series of canonical static models of elections that we extend to dynamic settings, including models with valence and a multi-dimensional policy space. We then present general principles that underlie the results from those models. In particular, we establish that candidates spend a long time using ambiguous language during the election campaign in equilibrium. ∗Kamada: Haas School of Business, University of California, Berkeley, Berkeley, CA 94720, e-mail: y.cam.24@gmail.com. Sugaya: Stanford Graduate School of Business, Stanford, CA, 94305, e-mail: tsugaya@stanford.edu; We thank Ernesto Dal Bo, Itay Fainmesser, Drew Fudenberg, Michihiro Kandori, Akitada Kasahara, Kei Kawai, Fuhito Kojima, David Laibson, John B. Londregan, Shih-En Lu, Francisco Mart́ınez-Mora, Adam H. Meirowitz, Stephen Morris, Kristopher Ramsay, Andrzej Skrzypacz, Ken Shepsle, Yuki Takagi, Satoru Takahashi, and the seminar participants at the Harvard University Department of Economics and Department of Government, the Princeton University Department of Economics and Department of Political Science, University of California, Berkeley, Yale University, the 21st Stony Brook International Conference on Game Theory, and the Urrutia Elejalde Workshop on Information, Dynamics and Political Decision Making for helpful comments. In addition, Steven Callander and Josh Gottlieb read through the previous versions of this paper and gave us very detailed comments, which significantly improved the paper. We also thank the careful reading and suggestions by the Editor and the referees. Judith Levi provided a superb professional editorial assistance, which again significantly improved the paper. We thank Emily Her, Douglas Hong, Omair Butt, and especially Lingxuan Wu for their excellent research assistantship. This paper subsumes and supersedes part of our unpublished working paper “Valence Candidates and Ambiguous Platforms in Policy Announcement Games” and its earlier version circulated as “Policy Announcement Game: Valence Candidates and Ambiguous Policies,” which Sugaya first presented at the 21st Stony Brook International Conference on Game Theory in 2010.