Unintended Effects of Transparency: The Consequences of Income Disclosure by Politicians

Carina Neisser () and Nils Wehrhöfer ()
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Carina Neisser: University of Cologne & IZA
Nils Wehrhöfer: Deutsche Bundesbank

No 354, ECONtribute Discussion Papers Series from University of Bonn and University of Cologne, Germany

Abstract: Public disclosure laws on politicians’ outside income aim to enhance electoral accountability, but their effects remain unclear and may backfire. Using a German disclosure reform, administrative tax data, and a difference-in-difference design, we show that MPs increased their outside income after public disclosure. We find suggestive evidence that the effect is driven by right-leaning MPs. A survey among voters shows that perceptions of outside income differ by party alignment: right-leaning voters view it as a sign of competence, while left-leaning voters associate it with weaker voter representation. These findings highlight the complex interplay between transparency, voter perception, and political behavior.

Keywords: Tax data; outside income; politicians; income disclosure (search for similar items in EconPapers)
JEL-codes: D72 D83 J45 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2025-01
New Economics Papers: this item is included in nep-acc, nep-cdm, nep-lma, nep-pol and nep-pub
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Persistent link: https://EconPapers.repec.org/RePEc:ajk:ajkdps:354

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