Abstract

We study the internal organization of political parties as the solution of a moral hazard problem between a party principal (or selectorate) and two factions. Factional mobilization effort bolsters a party’s electoral chances but can only be imperfectly monitored—via an internal contest. We model a party’s internal organization as a system of “prizes,” an al- location of resources between winner and loser of the internal contest. We show that when (i) a party’s baseline electoral strength is low and (ii) electoral outcomes are not too responsive to mobilization efforts, there is an inverse relationship between inter-party power sharing and intra-party power sharing: institutional settings that award more resources and policy influence to election winners should produce party structures that promote a more egalitarian allocation of power across factions. Our results help organize the empirically documented dispersion in party organizational structures.

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