A Theory of Clientelistic Politics versus Programmatic Politics
Pranab Bardhan and
Dilip Mookherjee ()
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Dilip Mookherjee: Boston University
No dp-317, Boston University - Department of Economics - The Institute for Economic Development Working Papers Series from Boston University - Department of Economics
We provide a theoretical analysis of the distinction between clientelistic and programmatic politics and resulting consequences for policy choices and political competition. Clientelism arises when elected officials exercise ex post discretion over delivery of government transfers to citizens in an informal sector, and condition this on political support. Two party Downsian competition features â€˜programmaticâ€™ equilibria involving policy convergence and close elections if parties are equally popular ex ante. If the informal sector is large enough, these equilibria are locally unstable, and multiple asymmetric â€˜clientelisticâ€™ locally stable equilibria arise. Clientelistic equilibria involve policy divergence, lower supply of public goods, and higher inequality in vote shares. Comparative statics and welfare properties of the two classes of equilibria are related to existing empirical evidence.
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