IDEAS home Printed from https://ideas.repec.org/a/eee/pubeco/v221y2023ics0047272723000385.html
   My bibliography  Save this article

Occupy government: Democracy and the dynamics of personnel decisions and public finances

Author

Listed:
  • Barbosa, Klenio
  • Ferreira, Fernando

Abstract

This work investigates causes and consequences of patronage in Brazilian cities since the country’s re-democratization. It uses five election cycles and compares the hiring of winning and losing party members in close elections to causally estimate patronage. Cities increase their shares of civil servants affiliated with winning political coalitions by 3 percentage points during a mayoral term, and also increase their wage shares by 4 percentage points. Overall, patronage explains slightly more than 50% of the large increase in politically affiliated public employees since re-democratization. Moreover, we find that federal transfers and lack of accountability are important determinants of patronage.

Suggested Citation

  • Barbosa, Klenio & Ferreira, Fernando, 2023. "Occupy government: Democracy and the dynamics of personnel decisions and public finances," Journal of Public Economics, Elsevier, vol. 221(C).
    • Handle: RePEc:eee:pubeco:v:221:y:2023:i:c:s0047272723000385
    DOI: 10.1016/j.jpubeco.2023.104856
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0047272723000385
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jpubeco.2023.104856?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Alesina, Alberto & Sachs, Jeffrey, 1988. "Political Parties and the Business Cycle in the United States, 1948-1984," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 20(1), pages 63-82, February.
    2. Timothy Besley & Anne Case, 2003. "Political Institutions and Policy Choices: Evidence from the United States," Journal of Economic Literature, American Economic Association, vol. 41(1), pages 7-73, March.
    3. Stefano Gagliarducci & Marco Manacorda, 2020. "Politics in the Family: Nepotism and the Hiring Decisions of Italian Firms," American Economic Journal: Applied Economics, American Economic Association, vol. 12(2), pages 67-95, April.
    4. Ernesto Dal Bó & Frederico Finan & Martín A. Rossi, 2013. "Strengthening State Capabilities: The Role of Financial Incentives in the Call to Public Service," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 128(3), pages 1169-1218.
    5. Folke, Olle & Hirano, Shigeo & Snyder, James M., 2011. "Patronage and Elections in U.S. States," American Political Science Review, Cambridge University Press, vol. 105(3), pages 567-585, August.
    6. Lucie Gadenne, 2017. "Tax Me, but Spend Wisely? Sources of Public Finance and Government Accountability," American Economic Journal: Applied Economics, American Economic Association, vol. 9(1), pages 274-314, January.
    7. Edward L. Glaeser & Giacomo A. M. Ponzetto & Jesse M. Shapiro, 2005. "Strategic Extremism: Why Republicans and Democrats Divide on Religious Values," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 120(4), pages 1283-1330.
    8. La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert, 1999. "The Quality of Government," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 15(1), pages 222-279, April.
    9. Santosh Anagol & Thomas Fujiwara, 2016. "The Runner-Up Effect," Journal of Political Economy, University of Chicago Press, vol. 124(4), pages 927-991.
    10. Guo Xu, 2018. "The Costs of Patronage: Evidence from the British Empire," American Economic Review, American Economic Association, vol. 108(11), pages 3170-3198, November.
    11. Stephanie Riegg Cellini & Fernando Ferreira & Jesse Rothstein, 2010. "The Value of School Facility Investments: Evidence from a Dynamic Regression Discontinuity Design," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(1), pages 215-261.
    12. Timothy Besley & Stephen Coate, 1997. "An Economic Model of Representative Democracy," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(1), pages 85-114.
    13. Fernanda Brollo & Tommaso Nannicini & Roberto Perotti & Guido Tabellini, 2013. "The Political Resource Curse," American Economic Review, American Economic Association, vol. 103(5), pages 1759-1796, August.
    14. Raymond Fisman & Florian Schulz & Vikrant Vig, 2014. "The Private Returns to Public Office," Journal of Political Economy, University of Chicago Press, vol. 122(4), pages 806-862.
    15. Brollo, Fernanda & Forquesato, Pedro & Gozzi, Juan Carlos, 2017. "To the Victor Belongs the Spoils? Party Membership and Public Sector Employment in Brazil," Economic Research Papers 269088, University of Warwick - Department of Economics.
    16. Emanuele Colonnelli & Mounu Prem & Edoardo Teso, 2020. "Patronage and Selection in Public Sector Organizations," American Economic Review, American Economic Association, vol. 110(10), pages 3071-3099, October.
    17. Rafael Dix‐Carneiro, 2014. "Trade Liberalization and Labor Market Dynamics," Econometrica, Econometric Society, vol. 82(3), pages 825-885, May.
    18. Imbens, Guido W & Angrist, Joshua D, 1994. "Identification and Estimation of Local Average Treatment Effects," Econometrica, Econometric Society, vol. 62(2), pages 467-475, March.
    19. Jian Chu & Raymond Fisman & Songtao Tan & Yongxiang Wang, 2021. "Hometown Ties and the Quality of Government Monitoring: Evidence from Rotation of Chinese Auditors," American Economic Journal: Applied Economics, American Economic Association, vol. 13(3), pages 176-201, July.
    20. Eric Avis & Claudio Ferraz & Frederico Finan, 2018. "Do Government Audits Reduce Corruption? Estimating the Impacts of Exposing Corrupt Politicians," Journal of Political Economy, University of Chicago Press, vol. 126(5), pages 1912-1964.
    21. Hibbs, Douglas Jr., 1992. "Partisan theory after fifteen years," European Journal of Political Economy, Elsevier, vol. 8(3), pages 361-373, October.
    22. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416-416.
    23. Toke Aidt & Peter Jensen, 2013. "Democratization and the size of government: evidence from the long 19th century," Public Choice, Springer, vol. 157(3), pages 511-542, December.
    24. Claudio Ferraz & Frederico Finan, 2008. "Exposing Corrupt Politicians: The Effects of Brazil's Publicly Released Audits on Electoral Outcomes," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 123(2), pages 703-745.
    25. Naércio Aquino Menezes-Filho & Marc-Andreas Muendler & Garey Ramey, 2008. "The Structure of Worker Compensation in Brazil, with a Comparison to France and the United States," The Review of Economics and Statistics, MIT Press, vol. 90(2), pages 324-346, May.
    26. Alberto Alesina, 1987. "Macroeconomic Policy in a Two-Party System as a Repeated Game," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 102(3), pages 651-678.
    27. Ernesto Dal Bó & Frederico Finan & Olle Folke & Torsten Persson & Johanna Rickne, 2017. "Who Becomes A Politician?," The Quarterly Journal of Economics, Oxford University Press, vol. 132(4), pages 1877-1914.
    28. Naércio Aquino Menezes-Filho & Marc-Andreas Muendler & Garey Ramey, 2008. "The Structure of Worker Compensation in Brazil, with a Comparison to France and the United States," The Review of Economics and Statistics, MIT Press, vol. 90(2), pages 324-346, May.
    29. Fernando Ferreira & Joseph Gyourko, 2009. "Do Political Parties Matter? Evidence from U.S. Cities," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 124(1), pages 399-422.
    30. Jiang, Junyan & Zhang, Muyang, 2020. "Friends with benefits: Patronage networks and distributive politics in China," Journal of Public Economics, Elsevier, vol. 184(C).
    31. Fisman, Raymond & Gatti, Roberta, 2002. "Decentralization and Corruption: Evidence from U.S. Federal Transfer Programs," Public Choice, Springer, vol. 113(1-2), pages 25-35, October.
    32. Raphael Corbi & Elias Papaioannou & Paolo Surico, 2019. "Regional Transfer Multipliers," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 86(5), pages 1901-1934.
    33. Rafael Dix-Carneiro & Brian K. Kovak, 2017. "Trade Liberalization and Regional Dynamics," American Economic Review, American Economic Association, vol. 107(10), pages 2908-2946, October.
    34. Eggers, Andrew C. & Hainmueller, Jens, 2009. "MPs for Sale? Returns to Office in Postwar British Politics," American Political Science Review, Cambridge University Press, vol. 103(4), pages 513-533, November.
    35. Frederico Finan & Benjamin A. Olken & Rohini Pande, 2015. "The Personnel Economics of the State," NBER Working Papers 21825, National Bureau of Economic Research, Inc.
    36. Brassiolo, Pablo & Estrada, Ricardo & Fajardo, Gustavo, 2020. "My (running) mate, the mayor: Political ties and access to public sector jobs in Ecuador," Journal of Public Economics, Elsevier, vol. 191(C).
    37. David S. Lee & Enrico Moretti & Matthew J. Butler, 2004. "Do Voters Affect or Elect Policies? Evidence from the U. S. House," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(3), pages 807-859.
    38. Anthony Downs, 1957. "An Economic Theory of Political Action in a Democracy," Journal of Political Economy, University of Chicago Press, vol. 65, pages 135-135.
    39. Hanming Fang & Zhe Li & Nianhang Xu & Hongjun Yan, 2018. "In the Shadows of the Government: Relationship Building During Political Turnovers," NBER Working Papers 25300, National Bureau of Economic Research, Inc.
    40. Lee, David S., 2008. "Randomized experiments from non-random selection in U.S. House elections," Journal of Econometrics, Elsevier, vol. 142(2), pages 675-697, February.
    41. Mitra Akhtari & Diana Moreira & Laura Trucco, 2022. "Political Turnover, Bureaucratic Turnover, and the Quality of Public Services," American Economic Review, American Economic Association, vol. 112(2), pages 442-493, February.
    42. Claudio Ferraz & Frederico Finan, 2011. "Electoral Accountability and Corruption: Evidence from the Audits of Local Governments," American Economic Review, American Economic Association, vol. 101(4), pages 1274-1311, June.
    43. Stephan Litschig & Kevin M. Morrison, 2013. "The Impact of Intergovernmental Transfers on Education Outcomes and Poverty Reduction," American Economic Journal: Applied Economics, American Economic Association, vol. 5(4), pages 206-240, October.
    44. Thomas Fujiwara, 2015. "Voting Technology, Political Responsiveness, and Infant Health: Evidence From Brazil," Econometrica, Econometric Society, vol. 83, pages 423-464, March.
    45. Brassiolo, Pablo & Estrada, Ricardo & Fajardo, Gustavo, 2020. "My (Running) Mate, the Mayor: Political Ties and Access to Public Jobs in Ecuador," Research Department working papers 1521, CAF Development Bank Of Latinamerica.
    46. Paolo Mauro, 1995. "Corruption and Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 110(3), pages 681-712.
    47. Alesina, Alberto, 1988. "Credibility and Policy Convergence in a Two-Party System with Rational Voters," American Economic Review, American Economic Association, vol. 78(4), pages 796-805, September.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bazzi, Samuel & Labanca, Claudio, 2023. "Campaign Connections," IZA Discussion Papers 16166, Institute of Labor Economics (IZA).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Klenio Barbosa & Fernando V. Ferreira, 2019. "Occupy Government: Democracy and the Dynamics of Personnel Decisions and Public Sector Performance," NBER Working Papers 25501, National Bureau of Economic Research, Inc.
    2. Lucie Gadenne, 2017. "Tax Me, but Spend Wisely? Sources of Public Finance and Government Accountability," American Economic Journal: Applied Economics, American Economic Association, vol. 9(1), pages 274-314, January.
    3. Ferreira, Fernando & Gyourko, Joseph, 2014. "Does gender matter for political leadership? The case of U.S. mayors," Journal of Public Economics, Elsevier, vol. 112(C), pages 24-39.
    4. Per G. Fredriksson & Le Wang & Patrick L Warren, 2013. "Party Politics, Governors, and Economic Policy," Southern Economic Journal, John Wiley & Sons, vol. 80(1), pages 106-126, July.
    5. Gouvêa, Raphael & Girardi, Daniele, 2021. "Partisanship and local fiscal policy: Evidence from Brazilian cities," Journal of Development Economics, Elsevier, vol. 150(C).
    6. Solé-Ollé, Albert & Viladecans-Marsal, Elisabet, 2013. "Do political parties matter for local land use policies?," Journal of Urban Economics, Elsevier, vol. 78(C), pages 42-56.
    7. Maximiliano Lauletta & Martín A. Rossi & Christian A. Ruzzier, 2022. "Audits and Government Hiring Practices," Economica, London School of Economics and Political Science, vol. 89(353), pages 214-227, January.
    8. Carlsson, Magnus & Dahl, Gordon B. & Rooth, Dan-Olof, 2016. "Do Politicians Change Public Attitudes?," IZA Discussion Papers 10349, Institute of Labor Economics (IZA).
    9. Magnus Carlsson & Gordon B. Dahl & Dan-Olof Rooth, 2015. "Backlash in Policy Attitudes After the Election of Extreme Political Parties," NBER Working Papers 21062, National Bureau of Economic Research, Inc.
    10. Thomas Braendle & Alois Stutzer, 2017. "Voters and Representatives: How Should Representatives Be Selected?," CREMA Working Paper Series 2017-05, Center for Research in Economics, Management and the Arts (CREMA).
    11. Colonnelli, Emanuele & Lagaras, Spyridon & Ponticelli, Jacopo & Prem, Mounu & Tsoutsoura, Margarita, 2022. "Revealing corruption: Firm and worker level evidence from Brazil," Journal of Financial Economics, Elsevier, vol. 143(3), pages 1097-1119.
    12. Lind, Jo Thori, 2020. "Rainy day politics. An instrumental variables approach to the effect of parties on political outcomes," European Journal of Political Economy, Elsevier, vol. 61(C).
    13. Solé-Ollé, Albert & Viladecans-Marsal, Elisabet, 2013. "Do political parties matter for local land use policies?," Journal of Urban Economics, Elsevier, vol. 78(C), pages 42-56.
    14. Brollo, Fernanda & Troiano, Ugo, 2016. "What happens when a woman wins an election? Evidence from close races in Brazil," Journal of Development Economics, Elsevier, vol. 122(C), pages 28-45.
    15. Maximiliano Lauletta & Martín A. Rossi & Christian A. Ruzzier, 2020. "Audits and the Quality of Government," Asociación Argentina de Economía Política: Working Papers 4404, Asociación Argentina de Economía Política.
    16. Jon H. Fiva & Olle Folke & Rune J. Sørensen, 2013. "The Power of Parties," CESifo Working Paper Series 4119, CESifo.
    17. Gerald Carlino & Thorsten Drautzburg & Robert Inman & Nicholas Zarra, 2023. "Partisanship and Fiscal Policy in Economic Unions: Evidence from US States," American Economic Review, American Economic Association, vol. 113(3), pages 701-737, March.
    18. Ash, Elliott & MacLeod, W. Bentley, 2021. "Reducing partisanship in judicial elections can improve judge quality: Evidence from U.S. state supreme courts," Journal of Public Economics, Elsevier, vol. 201(C).
    19. Grewenig, Elisabeth & Lergetporer, Philipp & Werner, Katharina & Woessmann, Ludger, 2020. "Do party positions affect the public's policy preferences? Experimental evidence on support for family policies," Journal of Economic Behavior & Organization, Elsevier, vol. 179(C), pages 523-543.
    20. Claudio Ferraz & Frederico Finan, 2011. "Electoral Accountability and Corruption: Evidence from the Audits of Local Governments," American Economic Review, American Economic Association, vol. 101(4), pages 1274-1311, June.

    More about this item

    Keywords

    Democracy; Elections; Personnel decisions; Patronage; Accountability; Rent-Seeking;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets
    • M5 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:pubeco:v:221:y:2023:i:c:s0047272723000385. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/505578 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.