Working Paper: CEPR ID: DP17190
Authors: Christian Fons-Rosen; Federico Boffa; Amedeo Piolatto; Francisco Cavalcanti
Abstract: We analyse partisan biases in the allocation of central discretionary transfers in a federal country. We study drought aid-relief in Brazil, where presidential and municipal elections alternate every two years, to identify a novel pattern of distributive politics, determined by the sequence of central and local elections. In particular, we show that alignment advantage materialises only in the period before municipal elections, while it disappears in the period before presidential elections.Furthermore, we show that even before mayoral elections partisanship only counts for districts with intermediate levels of aridity, where being aligned causes an increase by a factor of almost two (equivalent to +18.1 p.p.) in the chances of receiving aid-relief. We rationalise this pattern in a model with office-motivated politicians and rational voters.
Keywords: Federalism; Distributive Politics; Partisan Alignment; Presidential Elections; Aridity; Brazil
JEL Codes: D72; H11; H7
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| politically aligned districts (D72) | higher probability of receiving transfers (F16) |
| alignment of mayors with the presidential party (D79) | higher probability of receiving transfers (F16) |
| severity of drought (Q54) | alignment advantage in receiving aid relief (F35) |
| alignment bias disappears before presidential elections (D79) | shift in allocation strategy (D51) |
| timing of elections and severity of drought (K16) | likelihood of receiving aid (F35) |