The Political Resource Curse

Fernanda Brollo, Tommaso Nannicini, Roberto Perotti and Guido Tabellini

American Economic Review, 2013, vol. 103, issue 5, 1759-96

Abstract: This paper studies the effect of additional government revenues on political corruption and on the quality of politicians, both with theory and data. The theory is based on a political agency model with career concerns and endogenous entry of candidates. The data refer to Brazil, where federal transfers to municipal governments change exogenously at given population thresholds, allowing us to implement a regression discontinuity design. The empirical evidence shows that larger transfers increase observed corruption and reduce the average education of candidates for mayor. These and other more specific empirical results are in line with the predictions of the theory.

JEL-codes: D72 D73 H77 O17 O18 (search for similar items in EconPapers)
Date: 2013
Note: DOI: 10.1257/aer.103.5.1759
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Citations: View citations in EconPapers (288)

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Related works:
Working Paper: The Political Resource Curse (2010)
Working Paper: The Political Resource Curse (2010)
Working Paper: The Political Resource Curse (2010)
Working Paper: The Political Resource Curse (2009)
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