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When does the winner take more? The role of political alignment in transfers to Romanian municipalities

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  • Puscas, Georgiana

    (University of Warwick)

Abstract

This paper explores whether the political alignment between mayors and the central government brings additional financial benefits to municipalities in Romania, using a novel dataset over 2012-2018. Analysing close municipal elections, I apply a regression discontinuity design to identify the effect of political alignment on several categories of transfers. I find that politically aligned municipalities receive per capita about 19% more equalisation transfers, 46% more subventions and 30% more transfers for roads. The results indicate that transfers for decentralised costs at municipality level are nondiscretionary

Suggested Citation

  • Puscas, Georgiana, 2021. "When does the winner take more? The role of political alignment in transfers to Romanian municipalities," Warwick-Monash Economics Student Papers 05, Warwick Monash Economics Student Papers.
    • Handle: RePEc:wrk:wrkesp:05
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    File URL: https://warwick.ac.uk/fac/soc/economics/research/wmesp/manage/5_-_georgiana_puscas.pdf
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    More about this item

    Keywords

    transfers allocation ; political alignment ; electoral competition JEL Classification: D72 ; H77 ; H81 ; P16 ; C21;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • H81 - Public Economics - - Miscellaneous Issues - - - Governmental Loans; Loan Guarantees; Credits; Grants; Bailouts
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models

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