Building connections: Political corruption and road construction in India

Jonathan Lehne, Jacob Shapiro and Oliver Vanden Eynde
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Jonathan Lehne: PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement
Jacob Shapiro: Princeton's Woodrow Wilson School of Public and International Affairs - Princeton University

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Abstract: Politically-driven corruption is a pervasive challenge for development, but evidence of its welfare effects are scarce. Using data from a major rural road construction programme in India we document political influence in a setting where politicians have no official role in contracting decisions. Exploiting close elections to identify the causal effect of coming to power, we show that the share of contractors whose name matches that of the winning politician increases by 83% (from 4% to 7%) in the term after a close election compared to the term before. Regression discontinuity estimates at the road level show that political interference raises the cost of road construction and increases the likelihood that roads go missing.

Keywords: Corruption; Political connections; Public procurement; Kinship networks (search for similar items in EconPapers)
Date: 2018-03
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Citations: View citations in EconPapers (47)

Published in Journal of Development Economics, 2018, 131, pp.62 - 78. ⟨10.1016/j.jdeveco.2017.10.009⟩

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Related works:
Journal Article: Building connections: Political corruption and road construction in India (2018)
Working Paper: Building connections: Political corruption and road construction in India (2018)
Working Paper: Building connections: Political corruption and road construction in India (2016)
Working Paper: Building connections: Political corruption and road construction in India (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:pseptp:halshs-01802896

DOI: 10.1016/j.jdeveco.2017.10.009

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