Electoral Competition under the Threat of Political Unrest

We study elections in which one party (the strong party) controls a source of political unrest; e.g., this party could instigate riots if it lost the election. We show that the strong party is more likely to win the election when there is less information about its ability to cause unrest. This is because when the weak party is better informed, it can more reliably prevent political unrest by implementing a “centrist” policy. When there is uncertainty over the credibility of the threat, “posturing” by the strong party leads to platform divergence. ¤We thank Timothy Feddersen, Geo¤rey Garrett, Oliver Hart, Mathias Hounkpe, Nien-He Hsieh, Elena Krasnokutskaya, Eric Maskin, Steve Morris, Roger Myerson, Martin Osborne, Ben Polak, Andrei Shleifer, Christopher Udry, Asher Wolinsky, two anonymous referees and an editor of this journal for comments and suggestions. We are also grateful for helpful comments from seminar participants at University of Michigan, Harvard University, New York University and Yale University. We are responsible for any remaining errors.