IDEAS home Printed from https://ideas.repec.org/p/knz/dpteco/1423.html
   My bibliography  Save this paper

Appointed Versus Elected Mayors and Incentives to Pork-Barrel: Quasi-Experimental Evidence from Germany

Author

Listed:
  • Zohal Hessami

    (Department of Economics, University of Konstanz, Germany)

Abstract

Do incentives and policy choices of public officials depend on whether they are appointed by an elected body or directly elected by voters? I investigate this question using the example of state grants for highly visible municipal investment projects. To attract these grants, mayors must prepare and submit applications to the state government. My identification strategy exploits a natural experiment in a German state where mayor elections were gradually introduced. The difference-in-differences estimation results show that elected mayors attract 7 to 8% more investment grants from the state tier in election years, while for appointed mayors there is no cycle. Results based on hand-collected data for individual mayors exclude alternative transmission channels such as changes in (self-)selection of mayors or partisan alignment in grant allocation.

Suggested Citation

  • Zohal Hessami, 2014. "Appointed Versus Elected Mayors and Incentives to Pork-Barrel: Quasi-Experimental Evidence from Germany," Working Paper Series of the Department of Economics, University of Konstanz 2014-23, Department of Economics, University of Konstanz.
    • Handle: RePEc:knz:dpteco:1423
    as

    Download full text from publisher

    File URL: http://www.uni-konstanz.de/FuF/wiwi/workingpaperseries/WP_23_Hessami_2014.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Stefano Gagliarducci & Tommaso Nannicini & Paolo Naticchioni, 2011. "Electoral Rules and Politicians' Behavior: A Micro Test," American Economic Journal: Economic Policy, American Economic Association, vol. 3(3), pages 144-174, August.
    2. Stephen Coate & Brian Knight, 2011. "Government Form and Public Spending: Theory and Evidence from US Municipalities," American Economic Journal: Economic Policy, American Economic Association, vol. 3(3), pages 82-112, August.
    3. Toke Aidt & Graham Mooney, 2014. "Voter suffrage and the political budget cycle: evidence from the London Metropolitan Boroughs 1902-1937," Cambridge Working Papers in Economics 1401, Faculty of Economics, University of Cambridge.
    4. Laffont, Jean-Jacques, 1996. "Industrial policy and politics," International Journal of Industrial Organization, Elsevier, vol. 14(1), pages 1-27.
    5. Iaryczower, Matias & Lewis, Garrett & Shum, Matthew, 2013. "To elect or to appoint? Bias, information, and responsiveness of bureaucrats and politicians," Journal of Public Economics, Elsevier, vol. 97(C), pages 230-244.
    6. Sjahrir, Bambang Suharnoko & Kis-Katos, Krisztina & Schulze, Günther G., 2013. "Political budget cycles in Indonesia at the district level," Economics Letters, Elsevier, vol. 120(2), pages 342-345.
    7. Enikolopov, Ruben, 2014. "Politicians, bureaucrats and targeted redistribution," Journal of Public Economics, Elsevier, vol. 120(C), pages 74-83.
    8. Aidt, Toke S. & Mooney, Graham, 2014. "Voting suffrage and the political budget cycle: Evidence from the London Metropolitan Boroughs 1902–1937," Journal of Public Economics, Elsevier, vol. 112(C), pages 53-71.
    9. Thomas Stratmann & Martin Baur, 2002. "Plurality Rule, Proportional Representation, and the German Bundestag: How Incentives to Pork-Barrel Differ Across Electoral Systems," CESifo Working Paper Series 650, CESifo.
    10. Toke Aidt & Francisco Veiga & Linda Veiga, 2011. "Election results and opportunistic policies: A new test of the rational political business cycle model," Public Choice, Springer, vol. 148(1), pages 21-44, July.
    11. Lineberry, Robert L. & Fowler, Edmund P., 1967. "Reformism and Public Policies in American Cities," American Political Science Review, Cambridge University Press, vol. 61(3), pages 701-716, September.
    12. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-In-Differences Estimates?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(1), pages 249-275.
    13. Eric Maskin & Jean Tirole, 2004. "The Politician and the Judge: Accountability in Government," American Economic Review, American Economic Association, vol. 94(4), pages 1034-1054, September.
    14. Timothy Besley & Stephen Coate, 2003. "Elected Versus Appointed Regulators: Theory and Evidence," Journal of the European Economic Association, MIT Press, vol. 1(5), pages 1176-1206, September.
    15. Jonathan Levin & Steven Tadelis, 2010. "Contracting For Government Services: Theory And Evidence From U.S. Cities," Journal of Industrial Economics, Wiley Blackwell, vol. 58(3), pages 507-541, September.
    16. David P. Baron, 1988. "Regulation and Legislative Choice," RAND Journal of Economics, The RAND Corporation, vol. 19(3), pages 467-477, Autumn.
    17. Lynn MacDonald, 2008. "The impact of government structure on local public expenditures," Public Choice, Springer, vol. 136(3), pages 457-473, September.
    18. Patricia Funk & Christina Gathmann, 2013. "How Do Electoral Systems Affect Fiscal Policy? Evidence From Cantonal Parliaments, 1890–2000," Journal of the European Economic Association, European Economic Association, vol. 11(5), pages 1178-1203, October.
    19. Brollo, Fernanda & Nannicini, Tommaso, 2012. "Tying Your Enemy's Hands in Close Races: The Politics of Federal Transfers in Brazil," American Political Science Review, Cambridge University Press, vol. 106(4), pages 742-761, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Monika Köppl-Turyna, 2016. "Opportunistic politicians and fiscal outcomes: the curious case of Vorarlberg," Public Choice, Springer, vol. 168(3), pages 177-216, September.
    2. 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.
    3. Baskaran, Thushyanthan & Lopes da Fonseca, Mariana, 2016. "Electoral competition and endogenous political institutions: Quasi-experimental evidence from Germany," Journal of Economic Behavior & Organization, Elsevier, vol. 122(C), pages 43-61.
    4. Thushyanthan Baskaran, 2016. "Intergovernmental Transfers, Local Fiscal Policy, and the Flypaper Effect: Evidence from a German State," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 72(1), pages 1-40, March.
    5. Maaser, Nicola & Stratmann, Thomas, 2016. "Distributional consequences of political representation," European Economic Review, Elsevier, vol. 82(C), pages 187-211.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hessami, Zohal, 2014. "Electoral Rules for Mayors and Incentives to Pork-Barrel: Quasi-Experimental Evidence from German Municipalities," VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100432, Verein für Socialpolitik / German Economic Association.
    2. Enikolopov, Ruben, 2014. "Politicians, bureaucrats and targeted redistribution," Journal of Public Economics, Elsevier, vol. 120(C), pages 74-83.
    3. Garmann, Sebastian, 2015. "Elected or appointed? How the nomination scheme of the city manager influences the effects of government fragmentation," Journal of Urban Economics, Elsevier, vol. 86(C), pages 26-42.
    4. Leverty, J. Tyler & Grace, Martin F., 2018. "Do elections delay regulatory action?," Journal of Financial Economics, Elsevier, vol. 130(2), pages 409-427.
    5. Stephen Coate & Brian Knight, 2011. "Government Form and Public Spending: Theory and Evidence from US Municipalities," American Economic Journal: Economic Policy, American Economic Association, vol. 3(3), pages 82-112, August.
    6. Vlaicu, Razvan & Whalley, Alexander, 2016. "Hierarchical accountability in government," Journal of Public Economics, Elsevier, vol. 134(C), pages 85-99.
    7. Dalle Nogare, Chiara & Kauder, Björn, 2017. "Term limits for mayors and intergovernmental grants: Evidence from Italian cities," Regional Science and Urban Economics, Elsevier, vol. 64(C), pages 1-11.
    8. Geschwind, Stephan & Roesel, Felix, 2022. "Taxation under direct democracy," Journal of Economic Behavior & Organization, Elsevier, vol. 200(C), pages 536-554.
    9. Baskaran, Thushyanthan & Lopes da Fonseca, Mariana, 2021. "Appointed public officials and local favoritism: Evidence from the German states," Journal of Urban Economics, Elsevier, vol. 124(C).
    10. Stefanie Gaebler & Felix Roesel, 2019. "Do direct elections matter? Quasi-experimental evidence from Germany," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 26(6), pages 1416-1445, December.
    11. Chortareas, Georgios & Logothetis, Vasileios & Papandreou, Andreas A., 2016. "Political budget cycles and reelection prospects in Greece's municipalities," European Journal of Political Economy, Elsevier, vol. 43(C), pages 1-13.
    12. Ash, Elliott & MacLeod, W. Bentley, 2021. "Reducing partisanship in judicial elections can improve judge quality: Evidence from U.S. state supreme courts," Journal of Public Economics, Elsevier, vol. 201(C).
    13. David Martimort & Jérôme Pouyet & Carine Staropoli, 2020. "Use and abuse of regulated prices in electricity markets: “How to regulate regulated prices?”," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 29(3), pages 605-634, July.
    14. Baskaran, Thushyanthan & Brender, Adi & Blesse, Sebastian & Reingewertz, Yaniv, 2016. "Revenue decentralization, central oversight and the political budget cycle: Evidence from Israel," European Journal of Political Economy, Elsevier, vol. 42(C), pages 1-16.
    15. Eric Dubois, 2016. "Political business cycles 40 years after Nordhaus," Public Choice, Springer, vol. 166(1), pages 235-259, January.
    16. Garance Genicot & Laurent Bouton & Micael Castanheira, 2021. "Electoral Systems and Inequalities in Government Interventions [“Distributive Politics and Electoral Incentives: Evidence from Seven US State Legislatures.”]," Journal of the European Economic Association, European Economic Association, vol. 19(6), pages 3154-3206.
    17. Alexander Whalley, 2013. "Elected versus Appointed Policy Makers: Evidence from City Treasurers," Journal of Law and Economics, University of Chicago Press, vol. 56(1), pages 39-81.
    18. Dirk Foremny & Ronny Freier & Marc-Daniel Moessinger & Mustafa Yeter, 2018. "Overlapping political budget cycles," Public Choice, Springer, vol. 177(1), pages 1-27, October.
    19. Eric Dubois, 2016. "Political Business Cycles 40 Years after Nordhaus," Post-Print hal-01291401, HAL.
    20. Mark Partridge & Tim Sass, 2011. "The productivity of elected and appointed officials: the case of school superintendents," Public Choice, Springer, vol. 149(1), pages 133-149, October.

    More about this item

    Keywords

    Mayor elections; local government; electoral incentives; pork-barrel politics; intergovernmental grants;
    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
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:knz:dpteco:1423. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Office Ursprung (email available below). General contact details of provider: https://edirc.repec.org/data/fwkonde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.