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The Mixed-Member Majoritarian Electoral System, Effective Regional Political Leaders,

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 321

The Mixed-Member Majoritarian Electoral

System, Effective Regional Political Leaders,
and the Regional Hegemonic Party System:
A Panel Analysis of the South Korean Case*

Yong Heun An**

This paper analyzes the effects of the “mixed-member majoritarian”

(MMM) electoral system and effective regional political leaders on
the mitigation of the regional hegemonic party system in Korea,
while controlling for the influence of regional economic conditions
and the 2004 National Assembly election. Previous studies on the
effects of the MMM electoral system on the weakening of the
regional hegemonic party system had methodological limitations,
in that they superficially evaluated its institutional effect, using
such criteria as the proportionality index. Unlike these previous
studies, this research analyses the institutional effect of the MMM
electoral system in a more sophisticated manner, holding constant
the influence of effective regional political leaders, which may
nullify the effect of the MMM electoral system as an omitted variable
untreated by the previous studies. The panel analysis of this paper

** This work was supported by research grants from the Catholic University of
Daegu in 2012. I wish to thank the anonymous referees for their constructive
criticism of an earlier version of this article.
** Yong Heun An is a professor of Political Science at the Catholic University of
Daegu. He received his Ph.D. degree from the University of California, Los
Angeles (UCLA). His research has focused on the causal relationship between
elections and the electoral system on the one hand, and domestic and interna-
tional economic policies on the other. E-mail: yan@g.ucla.edu.

KOREA OBSERVER, Vol. 46, No. 2, Summer 2015, pp. 321-356.

© 2015 by THE INSTITUTE OF KOREAN STUDIES.
322 Yong Heun An
was able to reveal two crucial findings. Firstly, the MMM electoral
system has a statistically significant effect on the alleviation of the
regional hegemonic party system. Secondly, the presence of effective
political leaders in the regions has a negative determinant effect on
the mitigation of the regional hegemonic party system.
Key Words: Regional hegemonic party system, mixed-member
majoritarian (MMM) electoral system, effective regional
political leader, regional economy
I. Introduction
T his paper seeks to analyze the effects of the mixed-member
majoritarian (hereafter, MMM) electoral system1 and effective regional
political leaders on the mitigation of the regional hegemonic party
system in Korea, while controlling for the influence of the regional
economic conditions and the 2004 National Assembly election. When
it comes to electoral politics in Korea, it is the Korean voters’ regionally
biased voting that has been emphasized as a politically deep-rooted
factor that hinders Korean political development. Korean voters have
been inclined to cast their ballots for specific political parties depend-
ing on whether or not those political parties have been electorally
based in their respective hometowns. This problem dates back to the
1. The mixed systems include some combinations of the nominal tier with the list
tier. In the nominal tier, legislators are elected by the rule of the plurality
system. In the list tier, legislative seats are allocated by the rule of the proportional
representation system (Shugart and Wattenberg, 2001: 10-11). The crucial criterion
for identifying the mixed member majoritarian (MMM) systems and the mixed
member proportional (MMP) systems is how to allocate seats between the two
tiers. In the MMM systems, the list and nominal tiers allocate seats indepen-
dently, without considering the proportionality between seats and votes. In the
MMP systems, legislative seats in the nominal tiers are determined in a way
that is proportional to the results of the list tier (Shugart and Wattenberg, 2001:
11-12).
A Panel Analysis of the South Korean Case 323
1987 democratic uprising, which brought demands for a transition to
democracy and a direct presidential election. The democratic transi-
tion, which resulted from the 1987 democratic uprising, enabled the
beginning of the removal of various manifestations of authoritarian
rule: The constraints placed on the opposition’s political activities
were lifted, labor movements oppressed under the authoritarian
government began to actively develop, and the first direct presidential
election was held on December 19, 1987.
However, as democratization proceeded, Korean politics was
faced with a new and unforeseen political problem that has yet to be
resolved. Beginning with the 1987 presidential election, regionally
biased voting spurred by regionalism has manifested itself as a chronic
disease in every national election to date. It has hindered political
parties that have made strenuous efforts to represent a variety of
political and economic issues, such as the expansion of democratic
institutions and the improvement of income inequality, rather than
regional issues from entering the legislature, thereby contributing to
the emergence of the regional hegemonic party system — in which
some regional parties have enjoyed electoral dominance in specific
regions.
The reformist civic groups’ demand for political institutional
reform, particularly the introduction and expansion of the proportional
representation system, has been closely related to the problem of
regionally biased voting, which has persistently manifested itself in
every election since democratization. Regionally biased voting was
regarded as a cause for the emergence of the regional hegemonic
party system, in which small parties advocating policies in regard to a
variety of political and economic issues rather than regional ones
faced electoral difficulties in gaining legislative seats (Jung, 1997; Park,
1997; Lee, 1998; Jung, 1999; Chaung, 2003; Jung, 2003; Park, 2004; Kim,
2005; Chaung, 2006; Kim and Park, 2009; Ahn, 2010). In the end, the
demand for institutional reform resulted in the introduction of the
two-ballot MMM electoral system, in which 244 legislators are elected
in 244 electoral districts under the plurality system and 56 legislators
324 Yong Heun An
are elected in one national district under the proportional representa-
tion system.
This electoral reform, which had been litigated by civic groups
and politicians from the opposition, was triggered by the decision of
the Constitutional Court regarding the violation of the constitution.
The rationale behind the Constitutional Court’s decision was based
on the notion that the then Korean electoral system had violated the
constitution, since the proportional representation seat allocation
based on electoral results obtained under the plurality system had
violated the principle of direct election. The Constitutional Court
ruled that the then electoral system, which allowed voters to cast only
one ballot even though they had different choices of political parties
in local and nation-wide proportional constituencies, had a tendency
to restrict and distort voters’ electoral choices (Park, 2004: 42-43). Ulti-
mately, due to the Constitutional Court’s decision, the two-ballot
MMM electoral system was introduced in local elections in 2002 and,
finally, in the National Assembly elections in 2004.
Since the introduction of the new MMM electoral system, the
question of whether or not the new electoral system has achieved its
political goal is still being raised. The political and academic circles
undertook an evaluation of the electoral reform. In their assessment of
the institutional effect of the two-ballot MMM electoral system, they
reached the conclusion that the new electoral system had failed to
achieve its expected political objective: the weakening of regionally
biased voting and the mitigation of the regional hegemonic party sys-
tem (Kim, 2005: 103-5; Ahn, 2010: 285-86). The conventional argument
of previous studies is that the new MMM electoral system has not
gone far enough to eradicate the regional hegemonic party system
that hindered smaller parties from obtaining votes, a phenomenon
that has arisen from the prevalence of regional political parties main-
taining their monopolistic status as dominant parties in specific
regions.
However, when it comes to the conventional argument of studies
done in this area, what deserves cautious attention is that they suffer
A Panel Analysis of the South Korean Case 325
from fundamental methodological limitations. First, most of them
relied on only one or two electoral results of the National Assembly
election held after the electoral reform in order to evaluate the institu-
tional effects of the new MMM electoral system on the basis of criteria
such as the proportionality of vote to seat shares. Second, the previous
studies conducted only a superficial comparison of the changes in the
electoral results before and after the electoral reform. For instance,
these studies evaluated the institutional effect of the new electoral sys-
tem without considering the possibility of, and thus failing to control
for, “hidden” variables that could positively exert influence on the
regional hegemonic party system and simultaneously counterbalance
the impact of the new electoral system.
This study attempts to overcome the methodological limitations
of these studies. The paper endeavors to identify the omitted explana-
tory or “hidden,” variable that nullifies the effect of the new MMM
electoral system. Furthermore, this research focuses its attention on
conducting a more scientific analysis of the effects of the MMM elec-
toral system on the regional hegemonic party system. The hidden
explanatory variable analyzed by this study is the presence of effective
political leaders in the regions. By adopting a panel analysis, this paper
attempts to differentiate, and then to separate, the effect of the MMM
electoral system from that of effective regional political leaders in the
regional party system. Following this, it reevaluates the institutional
influence of the new MMM electoral system.
In performing a panel analysis, this research draws attention to
the psychological effect rather than the mechanical effect of the MMM
electoral system on the alleviation of the regional hegemonic party
system. Since the previous studies conducted a simple comparison of
the changes in each party’s seat share before and after the electoral
reform, they focused only on the mechanical effect of the new electoral
system. Contrary to this approach, this study scrutinizes the psycho-
logical effect of the new MMM electoral system, which forces voters
to take their wasted votes into consideration, by analyzing the changes
in each party’s vote share before and after the introduction of the
326 Yong Heun An
MMM electoral system (Duverger, 1954: 224-26).
The brief analytical results obtained from panel analyses with the
fixed effects (FE) and random effects (RE) method are as follows. First,
while the effect of the MMM electoral system looked statistically
insignificant without the new variable of effective regional political
leaders in the regression model, it turned out to be statistically signifi-
cant in the weakening of the regional hegemonic party system when
the new explanatory variable was included in the model. Second, the
presence of effective political leaders in the respective regions made
statistically significant contributions to the strengthening of the
regional hegemonic party system.
This paper is divided into the following four sections. Followed
by this introduction section, the second section, entitled “Literature
Review, Hypotheses, and Analytical Method,” reviews the previous
studies conducted on electoral reform in Korea. Duverger’s proposition
about the relationship between the electoral system and the political
party system is adopted, and the first hypothesis is derived from this
proposition. It relates to the effect of the new double-ballot MMM
electoral system on the alleviation of the regional hegemonic party
system, especially the increase in the number of electoral parties in the
regions. The second hypothesis is derived by focusing on the effects of
regional political leaders on the reinforcement of the regional hege-
monic party system. In this section, this paper also discusses how to
measure dependent, independent, and control variables in order to
test the hypotheses of the paper. Next, the third section entitled
“Panel Analysis and Results,” conducts panel analyses of cases of
electoral results from the 13th National Assembly election to the 19th
National Assembly election. The concluding section summarizes the
statistical results and suggests what their political implications are.
A Panel Analysis of the South Korean Case 327
II. Literature Review, Hypotheses, and Analytical Method
A. Literature Review2
Previous studies on the Korean electoral system can be categorized
into two research streams. One of the streams focuses on the identifi-
cation of causal factors for electoral reforms in Korea since the estab-
lishment of the first government. The other stream focuses its studies
on the institutional effects of the newly changed electoral system, such
as the alleviation of the vote-and-seat advantage ratio enjoyed by the
bigger parties.
The first stream, whose analytical focus is on the cause of elec-
toral reforms, highlights that electoral reforms before democratization
resulted from the political interests of authoritarian governments. In
other words, electoral reforms were used as “tools” by authoritarian
governments to maintain political power (Lee, 2006: 176-77; Ahn,
2010: 261-63). Electoral reforms after democratization were prompted
by such political problems as the severe disproportionality between
the vote and seat shares, deep-seated regional voting, and the pre-
dominant regional party system (Kim and Park, 2009: 179-80; Ahn,
2010: 264-67).
The second stream, which centers its attention on the political
effects of electoral reforms, tries to estimate and analyze whether or
not new electoral systems satisfy their expected goals. For example,
one study, which evaluated the extent of the improvement in propor-
tionality before and after the electoral reforms, holds that “even though
the mixed member electoral system was introduced, current major
political parties could sustain a similar seat advantage ratio to major
parties of the past, and the degree of the disadvantage ratio of small
parties did not improve” (Chaung, 2006: 202).
However, the evaluation of how much the regionally biased
2. The descriptive contents in the review of previous studies on the Korean elec-
toral system and the discussion of the relationship between the mixed-member
majoritarian electoral system and the regional hegemonic party system are
mostly quoted from a former paper of mine (An, 2012: 481-85).
328 Yong Heun An
voting patterns and the regional hegemonic party system have been
affected by the electoral reforms relies on a simple comparison of elec-
toral results on the vote and seat shares gained by regionally-based
parties before and after the electoral reform. These studies assert that
the regionally biased voting patterns did not improve even after the
electoral reform, and that regionally based parties still maintained
their dominant status in specific regions, such as Gyeongsang and Jeolla
provinces (Chaung, 2006: 204-5; Kim and Park, 2009: 192-93). These
studies stress that the reason why the mixed member system did not
work in a predictable way lies in the small number of proportional
seats in Korea’s mixed member electoral system (Chaung, 2006: 202-3;
Kim and Park, 2009: 189-91; Ahn, 2010: 281-83). In short, the previous
studies concluded that the institutional effects of the new mixed
member system were unsatisfactory.
The limitations of the previous studies are that these studies
conducted a very superficial analysis of the institutional effects of
the mixed member electoral system, in particular, on the regional
hegemonic party system. In other words, these studies brought their
focus only on a simple comparison of the changes in the regionally
based parties’ vote and seat shares before and after the electoral
reform. For instance, these studies emphasized that the regionally-
based parties gained higher vote and seat shares after the electoral
reform, pointing out that Jeolla-based parties, which had only obtained
66.8% of the vote share and 86.2% of the seat share in the Jeolla
province in the 2000 National Assembly election held before the elec-
toral reform, secured 85.7% of the vote share and 96.7% of the seat
share from the same region in the 2004 National Assembly election
held after the electoral reform (Chaung, 2006: 205).
What would happen then if there were uncontrolled hidden and
primary factors that might offset the political effect of the new mixed
member electoral system on mitigating the regional hegemonic party
system? If such uncontrolled factors exist, a simple comparison of the
vote and seat share gained by regionally based parties will inevitably
reveal its methodological limitation. Therefore, in order to overcome
the methodological problem evident in the previous research, this
A Panel Analysis of the South Korean Case 329
paper makes an effort to logically identify and empirically control for
the uncontrolled hidden variable of the existence of effective regional
political leaders that the previous research has neglected. Putting the
variable of effective regional political leaders into the equation is crucial
because it exerts a significant influence over the reinforcement of the
regional hegemonic party system while having a negative correlation
with the effect of the new electoral system at the same time.
B. Hypotheses
(1) The Electoral System and Regional Electoral Party System
An argument regarding the relationship between the electoral
and the political party system can be found in Duverger’s proposition
on the two-party and the multi-party system (Duverger, 1954: 217-18,
239-40). According to Duverger’s proposition, the simple plurality
single-member district system leads to the two-party system, whereas
the proportional representation system brings about the multi-party
system.3
A noticeable point with Duverger’s proposition regarding the
relationship between the electoral and the political party system is
that the electoral system has two effects on the formation of the political
party system. First, one of the notable effects is the mechanical effect.
The simple plurality system has a tendency to give big parties more
seats than the votes they obtain in the process of seat allocation, while
small parties receive fewer seats than votes.4
Second, the other effect exerted by the electoral system is the
psychological one. The psychological effect is inclined to influence
3. Riker refers to Duverger’s statement on the two-party system as Duverger’s
law, while giving his statement on the multi-party system the name Duverger’s
hypothesis (Riker, 1982: 754-57).
4. Most previous studies on the political effects of the new double-ballot mixed
member electoral system in Korea highlight the restricted effect of the new
electoral system, revealing that regionally based big parties’ seat shares corre-
sponding to the mechanical effect of the electoral system did not improve even
after the new electoral reform in 2004 (Jung and Jung, 2005: 39-40; Chaung,
2006: 201-2; Ahn, 2010: 274).
330 Yong Heun An
those voters who support candidates from small parties.5 When can-
didates for whom they like to cast their ballots are from small parties,
voters think that their votes will go to waste if they cast their ballots
for such individuals, since these candidates have a very low probability
of being elected (Downs, 1957: 48). In this situation, voters show an
electoral inclination to strategically cast their votes for candidates who
are from larger parties and whose policy position is closer to theirs to
defeat the candidates they dislike the most (Duverger, 1954: 224-26;
Riker, 1982: 761-62). As a result, small parties are destined to suffer
from the electoral disadvantage of retaining fewer votes, which makes
it more difficult for them to survive as an electoral party in both
districts and regions (Clark and Golder, 2006: 694-95).
As illustrated above, voters’ strategic voting has a great political
impact on small parties (or politicians from small parties). Small parties
that fail to gain legislative seats or sufficient votes lose their basis for
political survival. Therefore, they have little choice but to merge with
big parties, which ultimately results in only two big legislative parties’
surviving at the district level.6
On the other hand, it is more difficult for a mechanical and psy-
chological effect to arise under the proportional representation system
than under the simple plurality system. Since small parties can obtain
seats in proportion to the votes they gain, they are faced with fewer
disadvantages from the process of seat allocation. Thus, the propor-
tional representation system is less inclined to produce a mechanical
and psychological effect compared to the plurality system.
In addition, since voters under the proportional representation
5. In deducing the first hypothesis from Duverger’s proposition regarding the
relationship between the electoral system and the political party system, this
paper focuses on the institutional effect of the pure types of electoral systems
on political party systems, holding constant the other variables, such as the
presence of a third party with a “strong local minority” or “nationally powerful
organizations,” and the number of political cleavages (Duverger, 1954: 226; Rae,
1971: 95; Neto and Cox, 1997: 95).
6. If a political cleavage is similarly distributed in almost all the districts in a
country, the two-party system may emerge at the national level (Riker, 1982:
760-61; Tien, 1997: 197-98).
A Panel Analysis of the South Korean Case 331
system care less about their votes being wasted, they are willing to
cast their votes even for small parties. This voting behavior provides
small parties with a chance to get as many votes as they can secure.
Consequently, small parties do not need to merge with big parties,
which eventually contributes to the emergence of numerous electoral
and legislative parties (Riker, 1982: 758).
With this understanding, let us apply the causal logic of the elec-
toral and party system to the discussion on the effect of the MMM
electoral system on the regional electoral party system in South Korea.
Even though only 56 out of a total of 299 seats are elected by the pro-
portional representation system, the MMM electoral system enables
Korean voters to cast their votes for the proportional representation
seats without worrying about wasted votes, which makes it possible
for parties other than the larger dominant regional parties to gain
their own votes, thereby leading to an increase in the number of elec-
toral parties. This suggests:
Hypothesis 1: The double-ballot MMM electoral system, which includes
the proportional representation system, increases the
number of electoral parties in the regions.
(2) Effective Regional Political Leaders and the Regional Electoral
Party System
The second hypothesis of this paper is formulated on the basis of
the rational choice model.7 The rational choice model assumes that
voters have an interest in receiving policy benefits from governments
and that politicians want to be elected (Ames, 1990: 7-8; Geddes, 1991:
373-374; Geddes, 1994: 87-88; Shepsle and Bonchek, 1997: 15-8). These
basic assumptions on these two actors’ interests lead us to predict
their political behaviors:8 Voters are inclined to cast their votes for a
7. For a more detailed discussion on the assumptions of the rational choice model,
see Geddes (1994) and Shepsle and Bonchek (1997).
8. Given a set of alternative strategies, rational actors choose an alternative that
contributes to maximizing the chance of achieving their interests under institu-
tional environments (Shepsle and Bonchek, 1997: 30-3).
332 Yong Heun An
candidate (or a party) who can deliver those benefits, and politicians
make efforts to show their willingness to provide such benefits. If
those politicians are incumbents, they try to influence policy outcomes.
However, voters do not select a candidate only in the light of his
willingness to provide them with policy benefits. Voters have no
choice but to place greater emphasis on the probability of a candidate’s
winning an election and the extent of his political influence over their
preferred policies.9 This is because voters will lose their chance of
receiving policy outcomes if a candidate for whom they cast their
votes fails to be elected, or even when he is elected, if he is incapable
of producing policy outcomes (Geddes, 1991: 374). Therefore, all other
things being equal (ceteris paribus), voters have an electoral tendency
to prefer those candidates who have a higher probability of being
elected and those who exert more influential policy-making power to
those who do not.
Some senior politicians who have been elected for many terms
and have continued to retain political influence over policymaking
are subject to having a political interest in not staying as ordinary leg-
islators but becoming effective political leaders and, later on, aspiring
to be president.10 To maximize the chance of realizing this political
interest, they make every endeavor to secure and solidify their own
electoral bases to guarantee not only their own reelection but also
their political followers’ reelection. The reason why they care about
their followers’ electoral survival is that they hope to have as many
followers as possible in their party in order to be an effective political
leader.11
9. Rational choice theorists hold that politicians can manipulate bureaucrats into
creating policies they want with a variety of measures to monitor and punish
bureaucrats’ behavior. For more detailed discussions on these measures, see
Ramseyer and Rosenbluth (1993), Geddes (1994), and McCubbins and Noble
(1995).
10. The primary goal of these politicians is to become president in a country with a
presidential system and prime minister in a country with a parliamentary sys-
tem (Light, 1998: 2-5; Hayao, 1993: 98-103).
11. In general, even though the rules for selecting a party leader may vary with the
party, those who gain the largest number of legislators as their followers are
A Panel Analysis of the South Korean Case 333
These influential politicians can be divided by the types of their
electoral strategies: some of them employ electoral strategies that are
aimed more at nationally distributed voters, and others adopt electoral
strategies targeted more at regionally concentrated voters. Politicians
in the former category devote themselves to procuring electoral sup-
port from voters with national issues, targeting groups of voters such
as middle-class or lower-class ones, and pro-globalization or anti-
globalization groups, etc. Meanwhile, politicians in the latter category
make efforts to gain electoral support from those who reside in specific
regions with regional issues.
To make the second hypothesis, this study purports to focus on
the latter type of influential politicians who struggle to successfully
attract regionally concentrated voters rather than nationally distributed
ones. This paper hereafter refers to these influential politicians as
“effective regional political leaders” (Jiyeok-Maengju in Korean). There
are two requirements to qualify as an effective regional political leader.
First, the politician must strive to represent regional issues for his
respective hometown region and succeed in solidifying his electoral
base in the region, and second, he must have the potential to be an
electorally influential political leader as either a presidential candidate
or a coalition partner in presidential elections, with strong electoral
support in his hometown region.12
Those politicians who want to be effective regional political leaders
make every effort to solidify their electoral base in their respective
hometown regions, and then they seek to lead voters to cast their
ballots not only for themselves but also for candidates in their regions.
To achieve these political goals, the effective regional political leaders
make electoral promises and efforts to deliver regional economic
benefits to their hometown regions. Not only that, they persuade voters
more likely to become a party candidate for the position of president or prime
minister.
12. In fact, there have been such political leaders in Korea as Kim Dae-jung in the
Jeolla region, Kim Young-sam in the Gyeongsang region, Kim Jong-phil in the
Chungcheong region, Chung Dong-young in the Jeolla region, and Park Geun-
hye in the Gyeongsang region.
334 Yong Heun An
in their regions to believe that voters should give electoral support to
their followers so that they will be able to exert political influence over
making preferred policies for regional development in the legislature.
These efforts made by effective regional political leaders push
voters in these regions into drawing more attention to regional issues
than to national ones. Due to these leaders’ efforts, the voters begin to
put a higher priority on regional issues such as regional development.
In the end, voters in these regions cast their ballots for candidates from
the parties led by these effective regional political leaders, and, as a
result, such political parties are able to enjoy political status as a domi-
nant party in the region, while political parties that attempt to represent
other issues have difficulty in coping with electoral survival.
In the meantime, voters who do not have effective political leaders
in their regions have different electoral choices since they are less
affected by the efforts of these effective regional leaders. These voters
are less likely to consider economic benefits at the regional level than
those voters previously mentioned. As voters in these regions care
less about regional issues, a focus on a variety of issues, including
national ones, can arise in these regions. Thus, political parties which
emphasize and focus on policy issues at the national level, like anti-
inflationary policies and social welfare policies, are able to obtain
votes in these regions. Therefore, the number of electoral parties in
these regions increases. This suggests:
Hypothesis 2: The number of electoral parties increases less in the regions
with effective regional political leaders than in those with
an absence of such leaders.
C. Analytical Method
The dependent variable of this paper is the number of electoral
parties in each region13 in the National Assembly elections held after
13. Since the analytical focus of this paper is placed on the regional party system,
the level of its panel unit is a region rather than an electoral district. Thus, this
A Panel Analysis of the South Korean Case 335
democratization. Therefore, the cases analyzed in this paper are the
electoral outcomes of 16 regions, comprising Seoul, Busan, Daegu,
Incheon, Gwangju, Daejeon, Ulsan, Gyeonggi, Gangwon, Chungbuk,
Chungnam, Jeonbuk, Jeonnam, Gyeongbuk, Gyeongnam, and Jeju in the
1988, 1992, 1996, 2000, 2004, 2008, and 2012 National Assembly elections
(hereafter, NA elections). Because of the properties of these cases, the
data in this paper are composed of both cross-sectional and time-
series observations.
The structure of the data used in this paper makes it difficult to
employ the ordinary least squares (OLS) regression method. A critical
problem in estimating regression models from cross-sectional and
time-series data (panel data) is that the major assumptions on OLS
are unlikely to be satisfied. These problematic assumptions are
homoskedasticity and no-autocorrelation (Wooldridge, 2002: 336-38;
Gujarati, 2004: 441-43, 455-60; Wooldridge, 2010: 170-76).14 The violation
of the assumptions regarding homoskedasticity and no-autocorrela-
tion makes it difficult to trust the values of the standard errors of the
OLS, leading to incorrect statistical tests.
As an alternative analytical method to the OLS, the most frequently
employed panel method is the feasible generalized least squares (FGLS)
method.15 By running Monte Carlo simulations, Beck and Katz
demonstrated that the FGLS transformation induces overconfidence
of standard errors for FGLS estimators, which compels us to cast doubt
on many findings derived by the FGLS method (Beck and Katz, 1995:
paper draws attention to both the time-series variations in the same region and
the cross-sectional ones among the regions.
14. While heteroskedasticity cannot make an estimator biased, it can still make it
an inefficient one (Gujarati 2004, 393-95). In the presence of contemporaneously
and serially correlated residuals, the estimated regression line fits the data
quite well, leaving small estimated residuals. Thus, the estimated variances
seriously underestimate the true variances (Hibbs, 1974: 256-259).
15. To overcome the problems of (panel) heteroskedasticity and contemporaneous
and serial correlation, Kmenta and Park perform two sequential FGLS transfor-
mations. The first step is conducted to eliminate serial correlation of the errors,
and the next step is carried out to eliminate contemporaneous correlation of
the errors. For a more detailed discussion about the FGLS method, see Kmenta
(1986: 622-25).
336 Yong Heun An
642-44).16 The FGLS method provides the correct standard errors only
when the number of time-series observations is overwhelmingly larger
than that of cross-sectional ones (Beck and Katz, 1995: 638-40). As an
alternative, they recommend the panel-corrected standard errors
(PCSE) method (Beck and Katz, 1995; Beck and Katz, 2007). In their
evaluation of the PCSE method, they admit that it produces more
accurate estimators as the number of time-series observations per
cross-sectional ones increases (Beck and Katz, 1995: 641). In this regard,
the PCSE method does not look suitable for our data set, which is
composed of a small number of time-series observations.
As another alternative, this paper takes into consideration adopting
either the fixed effects (FE) method or the random effects (RE) method.
The FE method treats unobserved unit-specific factors as parameters
to estimate, while the RE method deals with them as random vari-
ables. To allow for heterogeneous effects caused by those unobserved
factors, the FE method performs a within-transformation17 of the panel
data, whereas the RE model transforms it with the random effects
estimator, θi, which is calculated with the error variances of both the
FE model and the between effects (BE) model.18 After running panel
analyses with both the FE and RE method, this paper identifies which
model is better for estimating the coefficients of the independent vari-
ables in these panel models by utilizing the Hausman test.19
16. The Monte Carlo simulations of the FGLS estimates reveal that the FGLS esti-
mator may understate variability by between 50% and 300% (Beck and Katz,
1995: 640-41).
17. The within-transformation is equivalent to unit-centering (Beck and Katz, 2007:
183-4). In other words, it subtracts the average values of those variables in each
panel unit from the values of dependent and independent variables in each
panel unit. Thus, the within-transformation makes it impossible to estimate the
impacts of any variables that do not vary over time (Min and Choi, 2012: 147-8;
Wooldridge, 2013: 495-6).
18.
The formula for calculating the RE estimator is “ .” In other words,
it is a weighted mean value of the BE and the FE estimators. When θi = 0, it
becomes the pooled OLS estimator, and when θi = 1, it is the FE estimator. For
a more detailed discussion about the RE estimator, see Min and Choi (2012:
147-49).
A Panel Analysis of the South Korean Case 337
The number of electoral parties, the dependent variable of this
study, is calculated by the equation 1/∑v i2, where vi is each party i’s
vote share in each region. By adopting the vote share gained by each
party in each region, this paper seeks to identify how much the double-
ballot MMM electoral system alleviates the psychological effect felt by
voters who are worried about their votes being wasted.20
The two independent variables of this study are measured as fol-
lows: The double-ballot MMM electoral system, the first independent
variable of the study, is represented as a dummy variable. If an election
is held under the MMM electoral system, we assign the number 1 to
it. Otherwise, the number 0 is given.
The second independent variable is the absence or presence of
effective regional political leaders. This variable is treated as a dummy
variable. If there is an effective political leader — such as Kim Young-
sam for Gyeongnam province and the city of Busan, Kim Dae-jung for
Jeonnam province and the city of Gwangju, Kim Jong-phil for Chungnam
province and the city of Daejeon, Lee Hwoe-chang for Chungnam
province and the city of Daejeon, Chung Dong-young for Jeonbuk
province, or Park Geun-hye for Gyeongbuk province and the city of
Daegu — we assign the number 1 to those regions.21 Meanwhile, this
19. The Hausman test compares coefficient estimates from the RE method to those
from the FE method. If the difference between the RE and FE is not statistically
significant, which means that they should converge to the true parameter values
in large samples, we can use the RE estimates. Otherwise, the FE estimates
should be used. To figure out the Hausman test in a more detailed manner, see
Hill, Griffiths, and Lim (2011: 558-60) and Wooldridge (2010: 288-90).
20. In their study on Duverger’s theory, Clark and Golder try to test the presence
of the psychological effect of the electoral systems on voters by using the vote
share of political parties (Clark and Golder, 2006). As mentioned above, since this
paper draws its attention to the psychological effect of the new MMM electoral
system, the analytical focus of the paper is on the number of electoral parties,
rather than that of legislative parties, by calculating the number of political
parties on the basis of the vote share obtained by each party in each region.
21. In identifying the hometown regions of effective regional political leaders, this
paper intends to narrow down the boundaries of the hometown regions. For
example, this paper assigns the hometown regions of Kim Dae-jung to Jeonnam
province and the city of Gwangju rather than to Jeolla (Jeonbuk and Jeonnam)
region and the city of Gwangju.
338 Yong Heun An
paper does not categorize Roh Mu-hyun and Moon Jae-in as effective
regional political leaders for Jeolla region,22 even though voters in this
region gave full electoral support to them. As the definition of “effec-
tive regional political leaders” in this paper states, this categorization
has been conducted this way mainly because they did not come from
Jeonbuk or Jeonnam province or the city of Gwangju, but rather from
Gyeongnam province.23 In addition, their electoral strategy did not
focus on stimulating regionally biased voting, but rather on overcom-
ing regionalism in Korean electoral politics.24 In general, the regions
of Gyeongsang, Jeolla, and Chungcheong are categorized as regions in
which there are effective political leaders. Otherwise, the number 0 is
given to a region.
The regression model also includes two control variables, which
may be correlated with our independent variables while affecting the
dependent variable, so that this paper can identify the correct effects
of the MMM electoral system and effective regional political leaders
on the regional hegemonic party system. Those two control variables
are the condition of the regional economy and the 2004 NA election.
The reason why this study treats regional economic conditions as
a control variable is that there is a higher probability of correlation
with both an independent variable, i.e. the presence of effective regional
political leaders, and the dependent variable. Economic conditions in
22. Jeolla region refers to the provinces of Jeonbuk and Jeonnam and the city of
Gwangju. Gyeongsang region includes the provinces of Gyeongbuk and Gyeongnam
and the cities of Daegu, Ulsan, and Busan. Chungcheong region is composed of
the provinces of Chungbuk and Chungnam and the city of Daejeon.
23. As mentioned in the process of making the second hypothesis, effective regional
political leaders refer to those who not only strive to represent regional issues
for their respective hometown regions but also have the potential to be an
electorally influential political leader as either a presidential candidate or a
coalition partner in presidential elections.
24. The reason most Jeolla voters cast their ballots for Moon in the 2012 presidential
election may result from their strategic voting to prevent Park Geun-hye, a
presidential candidate from the Gyeongsang region, from becoming president.
The electoral motivation for voters in Jeolla region was not to secure regional
economic development but to hinder an electoral victory by a presidential can-
didate from the Gyeongsang region, which had been regarded as a rival region.
A Panel Analysis of the South Korean Case 339
the regions afford political opportunities for would-be regional political
leaders. As the economy in a region deteriorates, voters take regional
development to be their overriding concern. Politicians who want to
be regional leaders have a political incentive to take advantage of the
economic situation in the region. Thus, the variable of effective regional
leaders may be closely correlated with that of the regional economic
conditions, which is why the regression model of this paper includes
the variable of the regional economic conditions.
To measure each respective regional economic condition, this
paper intends to use gross regional domestic production (GRDP). The
reason for employing GRDP is that it enables us to figure out the
extent of the recession and the growth of a regional economy. This
GRDP data is to be transformed as follows. First, this paper transforms
GRDP into its natural logarithm. By doing so, the extent to which the
number of electoral parties increases or decreases along with the
changes in the percentage of GRDP can be analyzed. Then the trans-
formed GRDP is differenced by the GRDP of the previous year to
capture the changes in the regional economic condition. The trans-
formed and differenced GRDP is given a one-year lag to identify the
causal relationship between the GRDP and the dependent variable by
preventing a reciprocal effect from arising between them.
The second control variable contained in the regression model is
the 2004 NA election. The reason for including this control variable is
that the 2004 NA election was a unique election. The 2004 NA election
was entirely influenced by the impeachment of President Roh Moo-
hyun, which was initiated by the political coalition between the then
two major parties, the Grand National Party and the Democratic
Party. Many Korean political scientists maintain that the issue of the
presidential impeachment dominated the 2004 NA election, which
simplified electoral issues into “pro-impeachment vs. anti-impeach-
ment,” thereby hindering other electoral issues from arising in the
2004 NA election.
The basic regression model, including the dependent, indepen-
dent, and control variables, is as follows. In this model, i and t represent
the region and the time period respectively (See Equation 1).
340 Yong Heun An A Panel Analysis of the South Korean Case 341

<Equation 1> Basic Panel Regression Model
ElectoralPartiesi,t = b0 + b1 MMM Systemi,t + b2Effective Regional Leaderi,t
+ b3LN_GRDPi,t-1 + b42004Electiont + εi,t
III. Panel Analysis and Results
Before analyzing the effect of the MMM electoral system and
effective regional political leaders on the formation of electoral parties
in the regions, this paper examines the descriptive statistics for the
variable of the number of regional electoral parties in order to figure
out the basic characteristics of the number of electoral parties in each
region. The statistics on electoral parties in each region reveal that the
average number of parties in all regions is 2.98 in all seven of the
National Assembly elections. The region with the largest number of
parties, with an average of 3.64, was Daejeon. The region with the
smallest number of parties, with an average of 1.88, was Gwangju,
followed by Jeonnam, Jeonbuk, Daegu, Busan, and Gyeongbuk in ascend-
ing order. As the statistics below illustrate, the stronger a region’s
regionally biased voting pattern, the smaller the number of electoral
parties it obtains (See Table 1).
Using a panel graph, this section looks into the time-series
changes in the number of electoral parties. Figure 1 displays a variety
of patterns of the changes in the number of electoral parties in these
sixteen regions. In Seoul, Incheon, and Gyeonggi, which are considered
to have relatively competitive party systems, the number of electoral
parties seems to be on a decreasing trend. Meanwhile, the electoral
parties in Gwangju and Jeonnam, which were electorally dominated by
a specific political party, show a tendency to increase in number in a

Table 1. Descriptive Statistics on Electoral Parties by Region Figure 1. Changes in the Number of Electoral Parties in the Sixteen Regions

Region Mean Standard Error Minimum Maximum

Seoul 3.26 0.64 2.55 4.49
Busan 2.80 0.49 2.42 3.82
Daegu 2.77 0.52 2.20 3.60
Incheon 3.35 0.50 2.66 3.86
Gwangju 1.88 0.51 1.26 2.53
Daejeon 3.64 0.39 3.09 4.12
Ulsan 3.54 0.53 2.84 4.10
Gyeonggi 3.38 0.57 2.73 4.14
Kangwon 3.39 0.50 2.52 3.99
Chungbuk 3.30 0.42 2.77 3.98
Chungnam 3.37 0.33 2.80 3.69
Jeonbuk 2.29 0.25 1.98 2.60
Jeonnam 2.19 0.33 1.84 2.80
Gyeongbuk 2.89 0.41 2.25 3.58
Gyeongnam 2.93 0.52 1.94 3.62
Jeju 3.04 0.59 2.26 3.89
Total 2.98 0.66 1.26 4.29
342 Yong Heun An A Panel Analysis of the South Korean Case 343

slightly alternate but continuously upward manner. However, Daegu Figure 2. Changes in the Presence of Effective Regional Leaders in the Sixteen Regions
and Gyeongbuk, which are the other representative regions with a
regional hegemonic party system, show a slightly decreasing trend,
with a somewhat wide fluctuation in terms of the number of their
electoral parties.
To figure out the cross-sectional and time-series variations for the
variable of effective regional political leaders, this research took a
close look at the panel graph, which describes the changes in the pres-
ence or absence of the regional political leaders in the sixteen regions.
As mentioned in the “Analytical Method” section, this paper intended
to narrow down the boundaries of the hometown regions of the effec-
tive regional political leaders, such as Kim Young-sam, Kim Jong-phil,
Kim Dae-jung, and Park Geun-hye in order to distinguish the effect of
the effective regional leaders from that of the regional parties.25 For
example, this paper did not categorize Jeolla (Jeonbuk and Jeonnam)
region and the city of Gwangju but rather Jeonnam province and the
city of Gwangju as the hometown regions of Kim Dae-jung. Thus, as
can be seen in Figure 2, there have been no effective regional leaders in
the city of Gwangju since the 2004 NA election held after the retirement
of Kim Dae-jung as president. In addition, Jeonbuk was categorized as
a region with an effective regional leader only after Chung Dong- It is well known that specific regional parties have maintained elec-
young exerted his political influence as an effective regional political toral dominance in these regions, except in Kangwon. Even though the
leader. effects of the other variables are not statistically controlled, this paper
Table 2 summarizes each region’s economic condition measured cautiously makes the assertion that there was a close relationship
by the natural-logged and differenced GRDP. The statistics in Table 2 between the regional economic conditions and the presence of the
demonstrate that the means of the natural-logged and differenced regional hegemonic party system.
GRDP in Busan, Daegu, Daejeon, Kangwon, Jeonbuk, Jeonnam, Gyeongbuk, The paper constructed two particular regression models to explore
and Gyeongnam were the same as or less than 0.09, which was the mean the impact of the MMM electoral system and effective regional political
of the natural-logged and differenced GRDP of all regions combined. leaders on the formation of the regional electoral party system, namely,
the changes in the number of electoral parties in the regions. The first
25. If this paper categorizes the boundaries of the effective regional leaders’ home- regression model includes only one variable, which is the double-
town regions in a broader way and then conducts the panel analysis, it will not ballot MMM electoral system. This model could be aimed at conduct-
be able to differentiate between the effect of the regional political leaders from ing an empirical test of the sole effect of the MMM electoral system
that of the regional political parties, even though a better statistical result can
be attained that the effect of effective regional political leaders becomes statisti-
without controlling for the independent variable of effective regional
cally more significant. political leaders and the other control variables, such as the regional
344 Yong Heun An A Panel Analysis of the South Korean Case 345

Table 2. Descriptive Statistics on Natural-Logged and Differenced GRDP us that autocorrelation and heteroskedasticity problems did not exist
Region Mean Standard Error Minimum Maximum in the models. In addition, this paper calculated the Variance Inflation
Seoul 0.10 0.06 -0.04 0.20 Factor (VIF), which quantifies the severity of multicollinearity. The
Busan 0.08 0.05 -0.03 0.22 values of the VIF show that the problem of multicollinearity did not
Daegu 0.08 0.06 -0.07 0.21 exist in the regression model.27
Incheon 0.10 0.08 -0.10 0.25 Based on the first regression model, the statistical results obtained
Gwangju 0.10 0.08 -0.08 0.27 from the analyses of the OLS and FE method are shown in Table 3.
Daejeon 0.09 0.06 -0.02 0.23 The results of Model 1-1 and Model 1-2 were gained by the OLS
Ulsan 0.10 0.05 -0.02 0.15 method and the FE panel method respectively. To determine which
Gyeonggi 0.11 0.06 -0.02 0.22 method, the OLS or the FE one, was more relevant for an analysis of
Kangwon 0.08 0.05 -0.03 0.16 our data, this paper performed an F test that was aimed at checking if
Chungbuk 0.10 0.06 -0.04 0.21 the estimates of the dummy variables for fifteen panel units (ui) were
Chungnam 0.10 0.10 -0.33 0.20 all 0.28 The result of the F test tells us that the one-way FE method,
Jeonbuk 0.09 0.06 -0.07 0.19 which takes into consideration panel-unit heterogeneous factors, was
Jeonnam 0.08 0.09 -0.21 0.22 more relevant than the OLS method, rejecting the null hypothesis that
Gyeongbuk 0.09 0.06 -0.05 0.21 unobserved panel-unit specific factors do not have statistically signifi-
Gyeongnam 0.08 0.14 -0.52 0.22 cant impacts on the formation of the regional electoral party system.
Jeju 0.10 0.07 -0.05 0.24 The statistical result of Model 1-2 in Table 3 reveals that the
Total 0.09 0.07 -0.10 0.21 MMM electoral system did not have a statistically noteworthy effect
on changes in the number of electoral parties in the regions, and even
economic conditions and the 2004 NA election. The second model, seemed to exert an unexpected influence on the regional electoral
which incorporates not only a new explanatory variable of the pres- party system in a way that strengthened the regional hegemonic party
ence of effective regional political leaders but also control variables system. This result can be evaluated to be consistent with the argument
like regional economic conditions and the 2004 NA election, offered of the previous studies that the introduction of the MMM electoral
an opportunity to test the effect of the MMM electoral system on the
formation of regional electoral parties, while controlling for the
of heteroskedasticity (Breusch and Pagan, 1979: 1288-90; Wooldridge, 2013:
impact of the new explanatory and control variables. 277-78). To obtain more detailed information about the Wooldridge test and the
After running a regression, this paper examined whether or not Breusch-Pagan test, see Wooldridge (2010: 282-5) and Wooldridge (2013: 275-78).
there was either an autocorrelation or a heteroskedasticity in the panel 27. The values of VIF on the variables of the MMM electoral system, the effective
regional political leaders, the regional economic condition, and the 2004 NA
models. These two problems were checked by the Wooldridge test and
election are 2.00, 1.65, 1.37, and 1.03, respectively. They are much smaller than
the Breusch-Pagan (BP) test respectively.26 The results of these tests tell a VIF of 10, which indicates a multicollinearity problem (O’Brien, 2007: 673-90).
28. This paper also tries to test the presence of time-unit heterogeneous effects by
26. Wooldridge (J. Wooldridge) derives a simple test for autocorrelation in panel including dummy variables for seven time units in the model and comparing
data (Wooldridge, 2010: 282-83). Based on the test procedure suggested by the F statistics. The result of the F test is that there is no time-unit effect in our
Wooldridge, this paper examined the presence of an autocorrelation. Breusch (T. panel data. Thus, this paper adopts the one-way rather than the two-way FE
Breusch) and Pagan (A. Pagan) suggest a test procedure for testing the presence method.
346 Yong Heun An A Panel Analysis of the South Korean Case 347

Table 3. Results of Panel Analysis 1 and the 2004 NA election by including these variables in the regres-
Model 1-1 (OLS) Model 1-2 (FE) sion model. In other words, the effect of the MMM electoral system is
2.99*** 3.07*** offset if the variables of the effective regional political leaders, the
Constant
(0.09) (0.09) regional economic condition, and the 2004 NA election are not con-
MMM Electoral Systemi,t
-0.02 -0.06 trolled for. However, the inclusion of these variables in the regression
(0.13) (0.09)
model enables us to differentiate the influence of the MMM electoral
N 108 108
system on the alleviation of the regional hegemonic party system. The
2
R 0.0003 0.0003
sign of the coefficient on the variable of the MMM electoral system
F test (for all ui = 0) 7.64 (p = 0.00)
illustrates that there has been a tendency for the number of electoral
The numbers in parentheses indicate standard errors.
* p<0.10, ** p<0.05, *** p<0.01 parties to increase after the introduction of the new electoral system.
After the introduction of the MMM electoral system, the number of
system did not have a significant contribution to the alleviation of the electoral parties in each region increased by approximately 0.33 on
regional hegemonic party system, a chronic problem whereby region- average. That is, political parties other than regional hegemonic parties
ally based parties enjoyed electoral dominance over specific regions. emerged as electoral parties following the electoral reform. This result
The panel analyses conducted on the basis of the second regres- supports Hypothesis 1 of the study.
sion model produced different statistical results. This paper employed The result shown for Model 2-1 from Table 4 reveals that the
two panel analyses with the FE and RE method and fulfilled the presence of effective regional political leaders has a statistically very
Hausman test to check if there were systematic differences between the significant and determinant effect on the regional party system. As
FE and the RE estimators. The result of the Hausman test rejects the
null hypothesis that the differences between the FE and RE estimators Table 4. Results of Panel Analysis 2
were not systematic. This result leads us to adopt the FE method
Model 2-1 (FE) Model 2-2 (RE)
because a crucial RE assumption regarding endogeneity29 was violated
2.89*** 2.89***
at the 0.10 level of statistical significance. Constant
(0.13) (0.17)
In the statistical results from Table 4, what deserves our attention 0.33** 0.35***
MMM Electoral Systemi,t
the most is that the influence of the MMM electoral system becomes (0.13) (0.13)

statistically significant when controlling for such variables as the -0.33*** -0.37***
Effective Regional Leaderi,t
(0.12) (0.12)
effective regional political leaders, the regional economic condition,
1.87** 2.06**
∆LN_GRDPi,t-1
(0.80) (0.81)
29. The random effects (RE) method assumes that the unobserved unit-specific -0.47*** -0.47***
effect (ui) is uncorrelated to each explanatory variable in the model. If ui is 2004 NA Electiont
(0.15) (0.15)
correlated to any explanatory variable, the RE estimators are not consistent,
N 108 108
while the FE estimators remain consistent. Unlike the FE estimators, the RE
estimators converge to some other values that are not the value of the true R2 0.23 0.23
parameters. In this case, it is methodologically suggested that a researcher χ2 = (b – B)´ [var(b) – var(B)]-1 (b – B) = 6.80
Hausman Test
adopts either the FE estimators or the Hausman-Taylor estimators, if the FE Prob ≥ χ2 = 0.08
method should not be employed, by using instrumental variables (Wooldridge, The numbers in parentheses indicate standard errors.
2010: 288-91, 325-28; Hill, Griffiths, and Lim, 2011: 560-62). * p<0.10, ** p<0.05, *** p<0.01
348 Yong Heun An A Panel Analysis of the South Korean Case 349

the sign of the coefficient on the variable of effective regional political
leaders demonstrates, the number of electoral parties in the respective
regions is inclined to decrease in the presence of effective political
leaders in the regions. If an effective regional leader appears in a
region, the number of electoral parties in the region becomes smaller
by about 0.33 on average. Voters who reside in regions with effective
regional political leaders are more likely to pay more attention to
regional issues such as regional development by giving their votes to
the regionally based parties, thereby contributing to the formation of
the dominant party system by the regionally based party. This result
empirically supports Hypothesis 2 of the paper.
In addition, the results shown for Model 2-1 from Table 4 illus-
trate that regional economic conditions and the 2004 NA election
exerted statistically very significant influences on the formation of the
Jeolla, Gyeongsang, and Chungcheong in which specific regional parties
have enjoyed electoral dominance. The statistical results in Table 5
demonstrate that the MMM electoral system and effective regional
political leaders had statistically significant impacts on the regional
party system in the Jeolla, Gyeongsang, and Chungcheong regions.32
Compared to the results from Table 4, the institutional effect of the
MMM electoral system appears to be a little stronger, as seen from the
fact that the estimated coefficient on the variable of the MMM elec-
toral system increases from 0.33 to 0.37. However, the political effect
of effective regional leaders becomes weaker; its estimated coefficient
changes from -0.33 to -0.27.
Table 5. Results of Panel Analysis 3
(Jeolla, Gyeongsang, and Chungcheong region only)

regional electoral party system. As the regional economy improves, Model 3-1 (FE) Model 3-2 (RE)
the number of electoral parties in the regions becomes larger. In the Constant
2.85*** 2.87***
(0.14) (0.17)
regions with better economic conditions than before, those political
0.37** 0.38***
parties that raise different electoral issues from regional ones are able MMM Electoral Systemi,t
(0.14) (0.15)
to retain electoral support from voters, thereby bringing about an
-0.27** -0.27**
increase in the number of electoral parties in these regions. According Effective Regional Leaderi,t
(0.12) (0.12)
to this result, as GRDP increases by 1% on the previous year’s GRDP, 0.77 0.87
∆LN_GRDPi,t-1
the number of electoral parties in the regions increases by approxi- (0.80) (0.82)

mately 0.02 (1.87/100) on average.30 As expected by many Korean -0.35** -0.35**

2004 NA Electiont
(0.16) (0.17)
scholars, the 2004 NA election resulted in contributing to the reduc-
N 71 71
tion in the number of electoral parties in the regions. Comparing the
R2 0.14 0.14
electoral results before and after the 2004 NA election, the number of
χ2 = (b – B)´ [var(b) – var(B)]-1 (b – B) = 5.09
electoral parties is inclined to decrease by about 0.47 on average. Hausman Test
Prob ≥ χ2 = 0.17
To substantiate the arguments with regard to the effects of the The numbers in parentheses indicate standard errors.
MMM electoral system and effective regional political leaders on the * p<0.10, ** p<0.05, *** p<0.01

weakening and strengthening of the regional hegemonic party system,

and multicollinearity, respectively. These tests reveal that these problems do
this study conducted an additional panel analysis31 on the regions of
not exist in this panel data.
32. The result of the Hausman test cannot reject the null hypothesis that the esti-
30. To understand how an estimated coefficient of a natural-logarithmic trans- mators of the FE and RE method are not systematically different, which allows
formed explanatory variable is interpreted, see Wooldridge (2013: 43-44). us to adopt the RE estimators that are more efficient than the FE estimators.
31. In the additional panel analysis, as done above, the Wooldridge, the BP, and the For a more detailed discussion on the efficiency of the FE and RE estimators,
VIF test are fulfilled for checking the presence of autocorrelation, heteroskedasticity, see Wooldridge (2010: 251-53) and Min and Choi (2012: 148-49).
350 Yong Heun An
IV. Conclusion
By conducting panel analyses of National Assembly elections
held after democratization, this paper has explored the effect of the
MMM electoral system and effective regional political leaders on the
alleviation of the regional hegemonic party system in Korea, while
controlling for the variables of the regional economic conditions and
the 2004 National Assembly election. Previous studies on the effects
of the MMM electoral system on the weakening of the regional hege-
monic party system had a methodological limitation, which superfi-
cially evaluated its institutional effect with such criteria as the propor-
tionality index. Unlike the previous studies, this research engaged in a
more sophisticated analysis of the institutional effect of the MMM
electoral system, holding constant the influence of effective regional
political leaders, which might nullify the effect of the MMM electoral
system as an omitted variable untreated by the previous studies.
The panel analyses of the paper revealed two crucial findings.
First, the variable of the MMM electoral system has been regarded as
statistically insignificant when the explanatory variable of effective
regional political leaders and two control variables, i.e. regional eco-
nomic conditions and the 2004 NA election, were not placed under
control. However, the MMM electoral system turns out to have a
statistically significant effect on the increase in the number of electoral
parties in the regions when including, and controlling for, such vari-
ables in the regression model. Secondly, the presence of effective
political leaders in the respective regions has mattered in the formation
of electoral parties in the regions. The existence of effective political
leaders has had a negative determinant effect on the number of
regional electoral parties, thereby giving rise to the strengthening of
the regional hegemonic party system. In addition, the control variable
of the regional economic conditions has also played a statistically
significant role in the formation of the regional party system. As a
region’s economic condition improves, the number of electoral parties
in the respective region has a tendency to increase.
A Panel Analysis of the South Korean Case 351
The statistical results obtained from the panel analyses have
significant political implications for political development in Korea.
First, in order to alleviate the chronic problems of the regionally
biased voting and the regional hegemonic party system, the results
suggest the need for an expansion in the number of the proportional
representation seats in the MMM electoral system. Considering the
significance of an institutional effect exerted by a quarter of the num-
ber of proportional representation seats on an increase in the number
of regional electoral parties, the expansion in the number of the pro-
portional representation seats is expected to mitigate the chronic
problems of regionally biased voting and the regional hegemonic
party system.
Second, the statistical results on the variable of effective regional
political leaders suggest a politically critical lesson for those politi-
cians who want to be political leaders in the future. Since the electoral
strategies selected by them to retain their political statuses as effective
political leaders can determine the political destiny of Korean region-
alism, they must be cautious about adopting electoral strategies. They
should employ those electoral strategies targeted more at nationally
distributed voters than at regionally concentrated ones so as to miti-
gate the chronic problems relating to the regional hegemonic party
system.33
Finally, as a measure to relieve these problems that are evident
in Korean electoral politics, the results suggest we should invigorate
the respective regional economies. Even though regionally balanced
economic development has been debated in terms of its economic
efficiency, it should be deliberately considered as a means of eradicat-
ing the deep-rooted Korean problem of the regionally biased voting
pattern and the regional hegemonic party system as well as preventing
the economic gap between the metropolitan areas, including the capital
33. As rational choice theorists whose focus is on the significance of political insti-
tutions — i.e. electoral systems — emphasize, it is institutional changes that
bring about changes in political actors’ strategies and behaviors. Thus, this paper
reemphasizes the necessity for electoral reforms (Shugart and Wattenberg,
2001; Farrell, 2011; Pillai, 2013).
352 Yong Heun An
city of Seoul and its satellite cities, and the non-metropolitan areas
from widening at an increased rate.
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