Sophisticated electoral accountability

How does voter sophistication affect electoral accountability and policy-making? This paper studies this question in a political-economic model where a politician in office, with career concerns, can conceal relevant information for policy-making. Voters have a different level of electoral sophistication, yet all care about the provision of a public good. Sophistication helps voters to formulate correct electoral and economic decisions and can be developed by investing in education. Where this ability is low, voters misjudge the behavior of the politician in office who cheats the electorate, misappropriates public funds, and, nonetheless, obtains re-election. I discuss the implications of this equilibrium. First, political deception deters aware, sophisticated voters from investing in education, which restricts future political expertise and electoral accountability. Second, fully revealed information deters cheating and can help less sophisticated societies embark on economic enhancing trajectories. In an infinite-horizon extension of the model, I underline a potential complementarity between accountability and sophistication that can be used to explain divergent equilibria in the long-run.