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Village Elections, Public Goods Investments and Pork Barrel Politics, Chinese-style

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  • Luo, Renfu
  • Zhang, Linxiu
  • Huang, Jikun
  • Rozelle, Scott

Abstract

A key issue in political economy concerns the accountability that governance structures impose on public officials and how elections and representative democracy influences the allocation of public resources. In this paper we exploit a unique survey data set from nearly 2450 randomly selected villages describing China’s recent progress in village governance reforms and its relationship to the provision of public goods in rural China between 1998 and 2004. Two sets of questions are investigated using an empirical framework based on a theoretical model in which local governments must decide to allocate fiscal resources between public goods investments and other expenditures. First, we find evidence—both in descriptive and econometric analyses—that when the village leader is elected, ceteris paribus, the provision of public goods rises (compared to the case when the leader is appointed by upper level officials). Thus, in this way it is possible to conclude that democratization—at least at the village level in rural China—appears to increase the quantity of public goods investment. Second, we seek to understand the mechanism that is driving the results. Also based on survey data, we find that when village leaders (who had been elected) are able to implement more public projects during their terms of office, they, as the incumbent, are more likely to be reelected. In this way, we argue that the link between elections and investment may be a rural China version of pork barrel politics.

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Bibliographic Info

Paper provided by International Association of Agricultural Economists in its series 2009 Conference, August 16-22, 2009, Beijing, China with number 50143.

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Date of creation: 2009
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Handle: RePEc:ags:iaae09:50143

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Keywords: Democratization; Elections; Public goods; Rural China; Political Economy; Public Economics; H41; H54; H71;

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  1. Dilip Mookherjee & Pranab K. Bardhan, 2000. "Capture and Governance at Local and National Levels," American Economic Review, American Economic Association, vol. 90(2), pages 135-139, May.
  2. Zhang, Xiaobo & Fan, Shenggen & Zhang, Linxiu & Huang, Jikun, 2004. "Local governance and public goods provision in rural China," Journal of Public Economics, Elsevier, vol. 88(12), pages 2857-2871, December.
  3. John Ferejohn, 1986. "Incumbent performance and electoral control," Public Choice, Springer, vol. 50(1), pages 5-25, January.
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  5. Deacon, Robert, 2003. "Dictatorship, Democracy, and the Provision of Public Goods," University of California at Santa Barbara, Economics Working Paper Series qt9h54w76c, Department of Economics, UC Santa Barbara.
  6. Rohini Pande, 2002. "Can mandated political representation increase policy influence for disadvantaged minorities? Theory and evidence from India," Discussion Papers 0102-62, Columbia University, Department of Economics.
  7. Abhijit Banerjee & Lakshmi Iyer & Rohini Somanathan, 2005. "History, Social Divisions, and Public Goods in Rural India," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 639-647, 04/05.
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  9. Robert Barro, 1973. "The control of politicians: An economic model," Public Choice, Springer, vol. 14(1), pages 19-42, March.
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  12. Besley, Timothy & Case, Anne, 1995. "Incumbent Behavior: Vote-Seeking, Tax-Setting, and Yardstick Competition," American Economic Review, American Economic Association, vol. 85(1), pages 25-45, March.
  13. Linxiu Zhang & Renfu Luo & Chengfang Liu & Scott Rozelle, 2006. "Investing in Rural China: Tracking China's Commitment to Modernization," Chinese Economy, M.E. Sharpe, Inc., vol. 39(4), pages 57-84, August.
  14. John A. List & Daniel M. Sturm, 2004. "How Elections Matter: Theory and Evidence from Environmental Policy," NBER Working Papers 10609, National Bureau of Economic Research, Inc.
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  16. Miguel, Edward & Gugerty, Mary Kay, 2005. "Ethnic diversity, social sanctions, and public goods in Kenya," Journal of Public Economics, Elsevier, vol. 89(11-12), pages 2325-2368, December.
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Cited by:
  1. Kieu-Trang Nguyen & Quoc-Anh Do & Anh Tran, 2011. "One Mandarin Benefits the Whole Clan: Hometown Infrastructure and Nepotism in an Autocracy," Working Papers 18-2011, Singapore Management University, School of Economics.
  2. Gerard Padro i Miquel & Nancy Qian & Yang Yao, 2012. "Social Fragmentation, Public Goods and Elections: Evidence from China," NBER Working Papers 18633, National Bureau of Economic Research, Inc.
  3. Jikun Huang & Yu Liu & Will Martin & Scott Rozelle, 2008. "Agricultural Trade Reform and Rural Prosperity: Lessons from China," NBER Working Papers 13958, National Bureau of Economic Research, Inc.
  4. Mu, Ren & Zhang, Xiaobo, 2014. "Do elected leaders in a limited democracy have real power? Evidence from rural China," Journal of Development Economics, Elsevier, vol. 107(C), pages 17-27.
  5. Xu, Cheng-Gang, 2010. "The Institutional Foundations of China’s Reforms and Development," CEPR Discussion Papers 7654, C.E.P.R. Discussion Papers.
  6. Chenggang Xu, 2011. "The Fundamental Institutions of China's Reforms and Development," Journal of Economic Literature, American Economic Association, vol. 49(4), pages 1076-1151, December.

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