Three Essays in Public and Political Economics

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This book includes three essays in applied game theory. The common topic is the question whether public institutions such as schools, governments, or parties fulfil the tasks designed for them. The first essay is on the Bologna Process, i.e. the process of increasing student mobility in Europe. We show that if student mobility depends positivelyon talent and universities are publicly financed, only imperfect student mobility will be optimal from a second-best perspective. The second essay provides a game-theoretic explanation for the robust gender gap in achievements of male and female pupils in math and sciences. There are less fernale than male bottom achievers and top achievers in math and sciences, and the mean achievement of girls is lower than that ofboys. This can be explained theoretically by assuming that math and science teachers discriminate or patronize their female pupils. The third essay analyzes the interaction oftwo parties, the incumbent politician (president or chancellor) and a representative voter. It shows that even if all agents within the political system prefer an informed policy over the inflexible implementation ofthe incumbent partys manifesto, seemingly ideological policy can nevertheless be the equilibrium outcome ofparty democracy. Thus, all three essays show that in one way or the other, public institutions like schools, universities and parties might miss the goals set for them, either intentionally or unintentionally.