The mechanical and psychological effects of legal thresholds

• Estimate causal effect of legal threshold on number of parties.
• Decompose this effect into a mechanical and psychological effect.
• Quasi-experimental approach exploiting features of Morocco local elections.
• Find mechanical effect relatively more important but psychological substantial.
• A 3% increase in threshold leaves one party out of council for strategic reasons.

In this paper, we estimate the effect of the legal threshold on the number of parties and decompose it into a mechanical and a psychological effect. We study the case of Morocco, whose local elections afford a rare opportunity to uncover the causal effect of the legal threshold, using a differences-in-differences approach. Our results show a large effect of the legal threshold on the number of parties. We find a large psychological effect in absolute terms: a 3% increase in the legal threshold leaves almost one effective party out of the council for purely strategic reasons. We conjecture that this large effect is due to the lack of institutionalization and programmaticness of most Moroccan parties.