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Competition in the political arena and local government performance

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  • John Ashworth
  • Benny Geys
  • Bruno Heyndels
  • Fanny Wille

Abstract

Competition reduces rent extraction in private-sector firms. In this article, we empirically assess whether it similarly disciplines politicians by evaluating local-level governments' performance in Flanders. The results indicate that electoral competition -- measured via the number of parties competing in elections -- significantly positively affects the productive efficiency of municipal policy. Intertemporal competition -- measured as the volatility of election outcomes over time -- has a similar, but weaker, positive effect. These beneficial effects are mitigated by the fact that competition may lead to more fragmented governments, which is shown to work against their productive efficiency. Overall, though, the beneficial effects outweigh the unfavourable ones in our sample.

Suggested Citation

  • John Ashworth & Benny Geys & Bruno Heyndels & Fanny Wille, 2014. "Competition in the political arena and local government performance," Applied Economics, Taylor & Francis Journals, vol. 46(19), pages 2264-2276, July.
    • Handle: RePEc:taf:applec:v:46:y:2014:i:19:p:2264-2276
    DOI: 10.1080/00036846.2014.899679
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    References listed on IDEAS

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    1. Fried, Harold O. & Lovell, C. A. Knox & Schmidt, Shelton S. (ed.), 1993. "The Measurement of Productive Efficiency: Techniques and Applications," OUP Catalogue, Oxford University Press, number 9780195072181.
    2. Fiva, Jon H. & Folke, Olle, 2016. "Mechanical and Psychological Effects of Electoral Reform," British Journal of Political Science, Cambridge University Press, vol. 46(2), pages 265-279, April.
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