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Resistance to Reform: Status Quo Bias in the Presence ofIndividual-Specific Uncertainty: CommentBy ANTONIO CICCONE*Why do governments so often fail to adopt marked by C) that will be enacted without ISreforms that economists consider efficiency- uncertainty although they would have been re-enhancing? This is the question addressed in an jected with uncertainty. A necessary conditioninfluential paper by Raquel Fernandez and Dani for this to happen is that a majority will turnRodrik (1991). They argue that one of the rea- out to gain G from reform and a minority tosons is that individual winners and losers of lose L. If voters know who wins and loses whenreform can often not be identified beforehand. they make their decision, reform will be ac-This individual-specific uncertainty leads to a cepted. If voters only know about the distribu-bias against reform. tion of winners and losers, reform will beBefore turning to their model, Fernandez and rejected as long as G is small relative to L.AsRodrik illustrate their argument with an exam- reforms may be enacted with IS uncertainty butple. The example assumes that voters are risk not without IS uncertainty and vice versa, Fer-neutral and that reforms need the support of a nandez and Rodrik argue that IS uncertaintymajority of the electorate. Fernandez and Ro- does not lead to a bias in favor of or againstdrik first argue that individual-specific (IS) un- reform when the electorate only gets to votecertainty does not ...

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• Publié par: Jitap
• Nombre de lectures: 30
• Langue: English

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