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Do Higher Wages Produce Career Politicians? Evidence from Two Discontinuity Designs

Author

Listed:
  • Jan Palguta
  • Filip Pertold

Abstract

Wages paid to politicians affect both the selection of candidates into electoral races and the on-the-job performance incentives of incumbents. We differentiate between selection and incentive effects using two regression discontinuity designs based on: 1) population thresholds shifting politicians' wages and 2) electoral seat thresholds splitting candidates into those who narrowly won or lost. We find that higher wages do not increase the electoral incumbency advantage, suggesting that the incentive effect of higher wages does not impact re-election rates. We further show that higher wages motivate narrowly elected incumbents to run again much less often than past narrowly non-elected candidates.

Suggested Citation

  • Jan Palguta & Filip Pertold, 2018. "Do Higher Wages Produce Career Politicians? Evidence from Two Discontinuity Designs," CERGE-EI Working Papers wp630, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
  • Handle: RePEc:cer:papers:wp630
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    File URL: http://www.cerge-ei.cz/pdf/wp/Wp630.pdf
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    Cited by:

    1. Klara Svitakova & Michal Soltes, 2020. "Sorting of Candidates: Evidence from 20,000 Electoral Ballots," CERGE-EI Working Papers wp652, The Center for Economic Research and Graduate Education - Economics Institute, Prague.

    More about this item

    Keywords

    re-election; political selection; electoral competition; wages; incumbency advantage; regression discontinuity design; municipal legislatures;
    All these keywords.

    JEL classification:

    • M52 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets
    • H57 - Public Economics - - National Government Expenditures and Related Policies - - - Procurement
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General

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