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Wedded to Prosperity? Informal Influence and Regional Favoritism

Author

Listed:
  • Pietro Bomprezzi
  • Axel Dreher
  • Andreas Fuchs
  • Teresa Hailer
  • Andreas Kammerlander
  • Lennart Kaplan
  • Silvia Marchesi
  • Tania Masi
  • Charlotte Robert
  • Kerstin Unfried

Abstract

This paper explores the informal influence of political leaders' spouses on the subnational allocation and effectiveness of development aid. We investigate whether regions containing the birthplaces of political leaders' spouses receive significantly more aid during their partners' tenure and whether this aid is less effective compared to other times. To examine these patterns, we construct two new global datasets: one tracking the personal characteristics of political leaders and their spouses, and another geocoding aid projects, including new data on aid from the United States and 18 European donors. Our analysis of the 1990-2020 period reveals that regions with the birthplaces of political leaders' spouses receive significantly more aid from Western bilateral donors, while political favoritism through Chinese aid shifts from the birth regions of spouses to those of the leaders themselves. We find that aid to the birth regions of spouses increases particularly before elections and is less effective there compared to aid given to the same regions at other times.

Suggested Citation

  • Pietro Bomprezzi & Axel Dreher & Andreas Fuchs & Teresa Hailer & Andreas Kammerlander & Lennart Kaplan & Silvia Marchesi & Tania Masi & Charlotte Robert & Kerstin Unfried, 2024. "Wedded to Prosperity? Informal Influence and Regional Favoritism," CESifo Working Paper Series 10969, CESifo.
  • Handle: RePEc:ces:ceswps:_10969
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp10969.pdf
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    References listed on IDEAS

    as
    1. Blair, Robert A. & Marty, Robert & Roessler, Philip, 2022. "Foreign Aid and Soft Power: Great Power Competition in Africa in the Early Twenty-first Century," British Journal of Political Science, Cambridge University Press, vol. 52(3), pages 1355-1376, July.
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    More about this item

    Keywords

    favoritism; informal influence; birth regions; development finance; foreign aid; official development assistance; political connections; geoeconomics;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • P33 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - International Trade, Finance, Investment, Relations, and Aid
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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