Policy Decay and Political Competition

Modern political systems exist not in a vacuum but in a world of continuous technological, social and economic change. This change means policies designed for today’s world will fit only imperfectly tomorrow, a phenomenon they refer to as policy decay. In principle, policymakers could legislate to remove decay and restore the status quo. In practice, however, the need for “something to be done” creates opportunities for the majority party to leverage their proposal power and for the minority party to obstruct to gain an electoral advantage. We consider a classic agenda-setter model and show how the combination of decay and political competition alters the underlying logic of policymaking. Policy changes frequently in this setting, even when moderate, contrary to the notion of legislative gridlock. Yet legislation to remove decay is not always struck, leaving all policymakers worse off. Moreover, the agreements that are struck are often to the benefit of the minority party, reversing the classic logic of agenda-setting power.