Some electoral systems encourage the evolution of political parties more than others. Also, the type of party system that evolves is greatly influenced by the electoral system in place.
The FPTP (First-Past-the Post) system, as the simplest example of Plurality/Majority systems, generally provides voters in a district a clear choice between two parties, often gravitating towards a party on the left and one on the right, alternating in power. This can be explained by the inherent disadvantages faced by smaller parties under FPTP. Typically, FPTP gives rise to a single-party government and to a coherent opposition party. The FPTP system advantages broadly based political parties that try to encompass many elements of the society and thus disadvantages extremist parties and those that focus on a single issue. On the other hand, the FPTP system excludes smaller parties and minorities from fair representation.
Proportional Representation Systems, on the other hand, encourage the formation of several political parties that generally reflect policy, ideology, or leadership differences within society. Also, minority parties gain easier access to representation. Under certain conditions, PR Systems can result in stability and continuity in government and public policy decision-making. Having said that, the greater number of parties that PR systems tend to give rise to may, at the worst, lead to a destabilizing of the political system in general.
For instance, in an extreme pluralistic system, the need for coalition governments sometimes forces parties to cooperate with tiny extremist parties in order to form a majority. PR systems can also offer an opening to extremist parties, because they, as all small parties, get a disproportionately large amount of power when larger parties need their support in order to form a government.
Other impacts of different types of electoral systems on political parties and party systems in democratic societies can be summarized as follows:
- Highly centralized political systems using closed-list PR are the most likely to encourage strong party organisations; conversely, decentralized, district-based systems like FPTP may have the opposite effect.
- Not only the shape of a party system but also the internal cohesion and discipline of parties may be affected by the electoral system design. Some electoral systems encourage more factionalism than others. This often leads to internal party disputes where one wing is constantly at odds with another wing. Other systems, in contrast, tend to foster the unity of a party, e.g. to speak with one voice.
- Besides the electoral system design, there are many other electoral variables that can be used to influence the development of party systems. For example, new democracies like Russia and Indonesia have attempted to shape the development of their nascent party systems by providing institutional incentives for the formation of national rather than regional political parties. Other countries, such as Ecuador and Papua New Guinea, have used party registration and funding requirements to achieve similar objectives.
- Access to public and/or private funding is a key issue that cuts across electoral system design, and is often the single biggest constraint on the emergence of viable new parties.
Just as electoral system choice will affect the way in which the political party system develops, the political party system in place affects the evolution of the electoral system. Existing parties are unlikely to support changes that are likely to seriously disadvantage them, or changes that open the possibility of new, rival parties gaining entry to the political party system, unless there is a strong political imperative. The range of options for electoral system change may thus be constrained in practice.