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Businessman Candidates: Special-Interest Politics in Weakly Institutionalized Environments

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  • Gehlbach, Scott
  • Sonin, Konstantin

Abstract

We initiate examination of the political boundaries of the firm by exploring the phenomenon of ‘businessman candidates’: business owners and managers who bypass conventional means of political influence to run for public office themselves. We argue that in-house production of political influence will be more likely in institutional environments where candidates find it difficult to make binding campaign promises. When campaign promises are binding, then a businessman may always pay a professional politician to run on the platform that political competition would otherwise compel the businessman to adopt. In contrast, when commitment to a campaign platform is impossible, then candidate identity matters for the policies that will be adopted ex post, implying that a businessman may choose to run for office if the stakes are sufficiently large. We illustrate our arguments through discussion of gubernatorial elections in postcommunist Russia, where businessmen frequently run for public office, institutions to encourage elected officials to keep their campaign promises are weak, and competition for rents is intense.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 4822.

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Date of creation: Dec 2004
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Handle: RePEc:cpr:ceprdp:4822

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Keywords: businessman candidates; citizen candidates; elections; institutions; political economy;

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Citations

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Cited by:
  1. Ulrich Matter & Alois Stutzer, 2013. "Do Lawyer-Legislators Protect Their Business? Evidence from Voting Behavior on Tort Reforms," Working papers 2013/09, Faculty of Business and Economics - University of Basel.
  2. Timothy Besley & Rohini Pande & Vijayendra Rao, 2005. "Political Selection and the Quality of Government: Evidence from South India," STICERD - Political Economy and Public Policy Paper Series 08, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
  3. Pande, Rohini, 2007. "Understanding Political Corruption in Low Income Countries," Working Paper Series rwp07-020, Harvard University, John F. Kennedy School of Government.
  4. Thomas Braendle, 2013. "Do Institutions Affect Citizens' Selection into Politics?," Working papers 2013/04, Faculty of Business and Economics - University of Basel.
  5. Stefano Gagliarducci & Tommaso Nannicini & Paolo Naticchioni, 2007. "Outside income and moral hazard : the elusive quest for good politicians," Economics Working Papers we073218, Universidad Carlos III, Departamento de Economía.
  6. Djankov, Simeon & La Porta, Rafael & López-de-Silanes, Florencio & Shleifer, Andrei, 2009. "Disclosure by Politicians," CEPR Discussion Papers 7168, C.E.P.R. Discussion Papers.
  7. Evgeny Yakovlev & Ekaterina Zhuravskaya, 2007. "Deregulation of Business," Working Papers w0097, Center for Economic and Financial Research (CEFIR).
  8. Timothy Besley, 2005. "Political Selection," Journal of Economic Perspectives, American Economic Association, vol. 19(3), pages 43-60, Summer.
  9. C. Simon Fan & Chen Lin & Daniel Treisman, 2010. "Embezzlement Versus Bribery," NBER Working Papers 16542, National Bureau of Economic Research, Inc.
  10. Beate R. Jochimsen & Sebastian Thomasius, 2012. "The Perfect Finance Minister: Whom to Appoint as Finance Minister to Balance the Budget?," Discussion Papers of DIW Berlin 1188, DIW Berlin, German Institute for Economic Research.
  11. Timothy Besley & Jose G. Montalvo & Marta Reynal‐Querol, 2011. "Do Educated Leaders Matter?," Economic Journal, Royal Economic Society, vol. 121(554), pages F205-, 08.
  12. Rohini Pande & Timothy Besley & Vijayendra Rao, 2005. "Political Selection and the Quality of Evidence: Evidence form South India," Working Papers id:261, eSocialSciences.
  13. Thomas Braendle & Alois Stutzer, 2011. "Selection of Public Servants into Politics," Working papers 2011/06, Faculty of Business and Economics - University of Basel.
  14. Serguey Braguinsky, 2009. "Postcommunist Oligarchs in Russia: Quantitative Analysis," Journal of Law and Economics, University of Chicago Press, vol. 52(2), pages 307-349, 05.

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