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Separating the Accountability and Competence Effects of Mayors on Municipal Spending

Author

Listed:
  • Boetti Lorenzo

    (HERMES (Higher Education and Research on Mobility Regulation and the Economics of Local Services), Collegio Carlo Alberto, Piazza Arbarello 8, 10122 Torino, Italy)

  • Franzoni Federico

    (Department of Economics and Finance (DEF), Università Cattolica del Sacro Cuore, Largo A. Gemelli 1, 20123 Milano, Italy)

  • Galmarini Umberto

    (Department of Law, Economics and Cultures (DiDEC), Università dell’Insubria, Via S. Abbondio 12, 22100 Como, Italy)

  • Piacenza Massimiliano

    (Department of Law and Political, Economic and Social Sciences (DIGSPES), University of Piemonte Orientale, Via Cavour 84, 15121 Alessandria, Italy)

  • Turati Gilberto

    (Department of Economics and Finance (DEF), Università Cattolica del Sacro Cuore, Largo Francesco Vito 1, 00168 Roma, Italy)

Abstract

The Italian legislation provides a two-term limits for mayors, but it allows term-limited mayors to pass on the torch to one of their deputies as candidates for mayorship. We exploit this feature of the electoral system to design a novel identification strategy for separating the effects of ‘accountability’ (the difference in performance between two politicians facing different incentives in terms of re-elections) and ‘competence’ (the difference in performance between two politicians with different experience in policy making). Using a panel of 1203 Italian municipalities, from 1998 to 2015, we find a significant role for competence but not for accountability in affecting municipal spending. Specifically, second-and-last-term mayors, and first-term mayors with previous experience as executive officers, spend less, on average, than inexperienced first-term mayors. We also discuss the policy implications of this finding.

Suggested Citation

  • Boetti Lorenzo & Franzoni Federico & Galmarini Umberto & Piacenza Massimiliano & Turati Gilberto, 2024. "Separating the Accountability and Competence Effects of Mayors on Municipal Spending," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 24(2), pages 597-647, April.
    • Handle: RePEc:bpj:bejeap:v:24:y:2024:i:2:p:597-647:n:5
    DOI: 10.1515/bejeap-2023-0093
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    More about this item

    Keywords

    accountability; competence; term limits; Italian municipalities;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures

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