Is polarization bad?

• Published in: European economic review 2012-08, Vol.56 (6), p.1104-1118
• Main Author: Testa, Cecilia
• Format: Article
• Language: English
• Subjects: Citizens; Corruption; Diversity; Economic models; Elections; Government policy; Polarization; Political actors; Political behavior; Political economy; Political parties; Political sociology; Politics; Studies
• ISSN: 0014-2921; 1873-572X
• DOI: 10.1016/j.euroecorev.2012.04.005

The adverse effects of political and social polarization on government policies are empirically well documented, yet some democracies seem to cope well or even benefit from diversity. In this paper we develop a theoretical model to show how elections in polarized societies contribute to improve quality of government. We consider both polarization among citizens and political actors (political polarization), where the second is endogenously determined by parties competing to win the support of the majority of voters. We find that more heterogeneous societies are more likely to be politically polarized, but that the divergence of positions in the political arena helps the electorate control government corruption by raising electoral stakes. Our results, which are consistent with the findings of a substantial empirical literature, suggest that, when funneled into political competition, polarization may help improving quality of government and policies. ► We study the effect of social and political polarization on electoral accountability. ► We show that elections in polarized societies help reducing political corruption. ► Political polarization, by raising electoral stakes, is key to ‘good government’. ► ‘Good government’ is costly for the moderate voter who must trade off ‘ideology’ for accountability.