Do Political Parties Matter? Evidence from U.S. Cities

Fernando Ferreira and Joseph Gyourko

No 13535, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We examine whether partisan political differences have important effects on policy outcomes at the local level using a new panel data set of mayoral elections in the United States. Applying a regression discontinuity design to deal with the endogeneity of the mayor's party, we find that party labels do not affect the size of government, the allocation of spending or crime rates, even though there is a large political advantage to incumbency in terms of the probability of winning the next election. The absence of a strong partisan impact on policy in American cities, which is in stark contrast to results at the state and federal levels of government, appears due to certain features of the urban environment associated with Tiebout sorting. In particular, there is a relatively high degree of household homogeneity at the local level that appears to provide the proper incentives for local politicians to be able to credibly commit to moderation and discourages strategic extremism.

JEL-codes: H7 R38 (search for similar items in EconPapers)
Date: 2007-10
New Economics Papers: this item is included in nep-cdm, nep-geo, nep-pol and nep-ure
Note: PE POL
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (35)

Published as Fernando Ferreira & Joseph Gyourko, 2009. "Do Political Parties Matter? Evidence from U.S. Cities-super-," The Quarterly Journal of Economics, MIT Press, vol. 124(1), pages 399-422, February.

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