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Does partisan alignment affect the electoral reward of intergovernmental transfers?

Author

Listed:
  • Albert Solé-Ollé

    (Universitat de Barcelona (UB); Institut d'Economia de Barcelona (IEB); CESifo)

  • Pilar Sorribas-Navarro

    (Universitat Barcelona (UB); Institut d'Economia de Barcelona (IEB))

Abstract

In this paper we test the hypothesis that intergovernmental grants allocated to co-partisans buy more political support than grants allocated to local governments controlled by opposition parties. We use a rich Spanish database containing information about the grants received by 617 municipalities during the period 1993-2003 from two different upper-tier governments (Regional and Upper-local), as well as data of municipal voting behaviour at three electoral contests held at the different layers of government during this period. Therefore, we are able to estimate two different vote equations, analysing the effects of grants given to aligned and unaligned municipalities on the vote share of the incumbent party/parties at the regional and local elections. We account for the endogeneity of grants by instrumenting them with the average amount of grants distributed by upper-layer governments. The results suggest that grants given to co-partisans buy some political support, but that grants given to opposition parties do not bring any votes, suggesting that the grantee reaps as much political credit from intergovernmental grants as the grantor

Suggested Citation

  • Albert Solé-Ollé & Pilar Sorribas-Navarro, 2008. "Does partisan alignment affect the electoral reward of intergovernmental transfers?," Working Papers 2008/2, Institut d'Economia de Barcelona (IEB).
    • Handle: RePEc:ieb:wpaper:doc2008-2
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    References listed on IDEAS

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    Cited by:

    1. Giardina, Emilio & Cavalieri, Marina & Guccio, Calogero & Mazza, Isidoro, 2009. "Federalism, Party Competition and Budget Outcome: Empirical Findings on Regional Health Expenditure in Italy," MPRA Paper 16437, University Library of Munich, Germany.
    2. repec:onb:oenbwp:y::i:169:b:1 is not listed on IDEAS
    3. Marco Manacorda & Edward Miguel & Andrea Vigorito, 2011. "Government Transfers and Political Support," American Economic Journal: Applied Economics, American Economic Association, vol. 3(3), pages 1-28, July.
    4. Thushyanthan Baskaran & Zohal Hessami, 2017. "Political alignment and intergovernmental transfers in parliamentary systems: evidence from Germany," Public Choice, Springer, vol. 171(1), pages 75-98, April.
    5. Padovano, Fabio, 2012. "The drivers of interregional policy choices: Evidence from Italy," European Journal of Political Economy, Elsevier, vol. 28(3), pages 324-340.
    6. Oskar Nupia, 2011. "Anti-Poverty Programs and Presidential Election Outcomes: Familias en Acción in Colombia," Documentos CEDE 8743, Universidad de los Andes, Facultad de Economía, CEDE.
    7. Banaszewska, Monika & Bischoff, Ivo, 2021. "Grants-in-aid and election outcomes in recipient jurisdictions: The impact of EU funds on mayoral elections in Poland," European Journal of Political Economy, Elsevier, vol. 68(C).
    8. Maria Teresa Balaguer-Coll & María Isabel Brun-Martos & Anabel Forte & Emili Tortosa-Ausina, 2014. "Determinants of local governments'­ reelection: New evidence based on a Bayesian approach," Working Papers 2014/06, Economics Department, Universitat Jaume I, Castellón (Spain).
    9. Bönke Timm & Schröder Carsten & Jochimsen Beate, 2017. "Fiscal Equalization and Tax Enforcement," German Economic Review, De Gruyter, vol. 18(3), pages 377-409, August.
    10. Steffen Osterloh, 2011. "Can Regional Transfers Buy Public Support? Evidence from EU Structural Policy," Working Papers 169, Oesterreichische Nationalbank (Austrian Central Bank).
    11. Alexander Stoecker, 2021. "Partisan Alignment and Political Corruption: Evidence from a New Democracy," MAGKS Papers on Economics 202101, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    12. Sandhya Garg, 2015. "Spatial convergence in public expenditure across Indian states: Implication of federal transfers," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2015-028, Indira Gandhi Institute of Development Research, Mumbai, India.
    13. Laura Bianchini & Federico Revelli, 2013. "Green Polities: Urban Environmental Performance and Government Popularity," Economics and Politics, Wiley Blackwell, vol. 25(1), pages 72-90, March.
    14. Thushyanthan Baskaran, 2013. "Do bailouts buy votes? Evidence from a panel of Hessian municipalities," Economics of Governance, Springer, vol. 14(3), pages 257-278, August.
    15. Bianka Dettmer & Thomas Sauer, 2019. "Implementation of European Cohesion Policy at the sub‐national level: Evidence from beneficiary data in Eastern Germany," Papers in Regional Science, Wiley Blackwell, vol. 98(1), pages 167-189, February.
    16. Monika Banaszewska & Ivo Bischoff, 2018. "Grants-in-aid and the prospect of re-election: The impact of EU funds on mayoral elections in Poland," MAGKS Papers on Economics 201822, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    17. Alexander Stoecker, 2021. "Partisan Alignment and Political Corruption: Evidence from a New Democracy," Volkswirtschaftliche Diskussionsbeiträge 192-21, Universität Siegen, Fakultät Wirtschaftswissenschaften, Wirtschaftsinformatik und Wirtschaftsrecht.
    18. Thushyanthan Baskaran, 2017. "Local fiscal policy after a bailout: austerity or soft budget constraints?," Economics of Governance, Springer, vol. 18(3), pages 209-238, August.
    19. Luisa Schneider & Daniela Wech & Matthias Wrede, 2022. "Political alignment and project funding," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 29(6), pages 1561-1589, December.
    20. Stoecker, Alexander, 2022. "Partisan alignment and political corruption: Evidence from a new democracy," World Development, Elsevier, vol. 152(C).
    21. Baskaran, Thushyanthan, 2014. "Bailouts and austerity," University of Göttingen Working Papers in Economics 212, University of Goettingen, Department of Economics.
    22. Balaguer-Coll, Maria Teresa & Brun-Martos, María Isabel & Forte, Anabel & Tortosa-Ausina, Emili, 2015. "Local governments' re-election and its determinants: New evidence based on a Bayesian approach," European Journal of Political Economy, Elsevier, vol. 39(C), pages 94-108.

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    More about this item

    Keywords

    Voting; parties; grants;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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