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The Cabals of a Few or the Confusion of a Multitude: The Institutional Trade-Off between Representation and Governance

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  • Leah Brooks
  • Justin Phillips
  • Maxim Sinitsyn

Abstract

Our model illustrates how political institutions trade off between the competing goals of representation and governance, where governance is the responsiveness of an institution to a single pivotal voter. We use exogenous variation from the 30-year history of the federal Community Development Block Grant program to identify this trade-off. Cities with more representative governments—those with larger city councils—use more grant funds to supplement city revenues rather than implementing tax cuts, thereby moving policy further away from the governance ideal. In sum, more representative government is not without cost. (JEL D72, H71, R50)

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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Journal: Economic Policy.

Volume (Year): 3 (2011)
Issue (Month): 1 (February)
Pages: 1-24

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Handle: RePEc:aea:aejpol:v:3:y:2011:i:1:p:1-24

Note: DOI: 10.1257/pol.3.1.1
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  1. Martin Osborne & Jeffry Rosenthal & Matthew A. Turner, 1998. "Meetings with costly participation," Working Papers mturner-98-02, University of Toronto, Department of Economics.
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  13. Gordon, Nora, 2004. "Do federal grants boost school spending? Evidence from Title I," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 1771-1792, August.
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  15. Justin H. Phillips, 2010. "An Institutional Explanation for the Stickiness of Federal Grants," Journal of Law, Economics and Organization, Oxford University Press, vol. 26(2), pages 243-264.
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Cited by:
  1. Aidt, T.S. & Shvets, J., 2011. "Distributive Politics and Electoral Incentives: Evidence from Seven US State Legislatures," Cambridge Working Papers in Economics 1130, Faculty of Economics, University of Cambridge.

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