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The Political Economy of Program Enforcement: Evidence from Brazil

Fernanda Brollo, Katja Kaufmann () and Eliana La Ferrara

No 11964, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Do politicians manipulate the enforcement of conditional welfare programs to influence electoral outcomes? We study the Bolsa Familia Program (BFP) in Brazil, which provides a monthly stipend to poor families conditional on school attendance. Repeated failure to comply with this requirement results in increasing penalties. First, we exploit random variation in the timing when beneficiaries learn about penalties for noncompliance around the 2008 municipal elections. We find that the vote share of candidates aligned with the President is lower in zip codes where more beneficiaries received penalties shortly before (as opposed to shortly after) the elections. Second, we show that politicians strategically manipulate enforcement. Using a regression discontinuity design, we find weaker enforcement before elections in municipalities where mayors from the presidential coalition can run for reelection. Finally, we provide evidence that manipulation occurs through misreporting school attendance, particularly in municipalities with a higher fraction of students in schools with politically connected principals.

New Economics Papers: this item is included in nep-cdm, nep-dev, nep-edu, nep-lam and nep-pol
Date: 2017-04
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