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After Apartheid: The Effects of ANC Power

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  • Poulsen, Jonas

    ()
    (Uppsala Center for Fiscal Studies)

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    Abstract

    The African National Congress (ANC) can look back on eighty years of struggle which resulted in the liberation of black Africans, the creation of a democratic constitution and free elections. However, the last twenty years of ANC rule has been criticized for the failure to bring higher living standards for the formerly oppressed. With the party's dominance and the challanges facing South Africa in mind, I estimate the effect of ANC power in municipalities on economic, social and budgetary outcomes. To estimate the causal effect of the party, this paper uses an instrumental variable approach developed by Freier & Odendahl (2012) and a regression discontinuity design. Taken together, the results point to an adverse effect of the party: less is spent on repairs and water provision which in turn may explain why ANC power seems to lower the share of individuals who have access to piped water and electricity. Further, more resources are used on municipal employees and the councillors themselves, while I find suggestive evidence of an increase in the poverty rate due to the party. Lastly, although being their major political support, we cannot conclude that the ANC affects black African's living standards. From the IV analysis, I find indications that oppositional parties many times have a more positive impact on outcomes as they gain power at the expence of the ANC.

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    File URL: http://ucfs.nek.uu.se/digitalAssets/183/183408_201310.pdf
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    Bibliographic Info

    Paper provided by Uppsala University, Department of Economics in its series Working Paper Series, Center for Fiscal Studies with number 2013:10.

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    Length: 42 pages
    Date of creation: 09 Sep 2013
    Date of revision:
    Handle: RePEc:hhs:uufswp:2013_010

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    Postal: Department of Economics, Uppsala University, P. O. Box 513, SE-751 20 Uppsala, Sweden
    Phone: + 46 18 471 25 00
    Fax: + 46 18 471 14 78
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    Web page: http://www.nek.uu.se/
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    Related research

    Keywords: ANC; party effects; instrumental variable; regression discontinuity; South Africa;

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    1. Guido Imbens & Karthik Kalyanaraman, 2010. "Optimal bandwidth choice for the regression discontinuity estimator," CeMMAP working papers CWP05/10, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
    2. Per Pettersson-Lidbom, 2008. "Do Parties Matter for Economic Outcomes? A Regression-Discontinuity Approach," Journal of the European Economic Association, MIT Press, vol. 6(5), pages 1037-1056, 09.
    3. Guido Imbens & Thomas Lemieux, 2007. "Regression Discontinuity Designs: A Guide to Practice," NBER Working Papers 13039, National Bureau of Economic Research, Inc.
    4. David S. Lee & Thomas Lemieux, 2009. "Regression Discontinuity Designs in Economics," NBER Working Papers 14723, National Bureau of Economic Research, Inc.
    5. Fernando Ferreira & Joseph Gyourko, 2009. "Do Political Parties Matter? Evidence from U.S. Cities-super-," The Quarterly Journal of Economics, MIT Press, vol. 124(1), pages 399-422, February.
    6. Brahima Coulibaly & Trevon D. Logan, 2009. "South Africa's post-apartheid two-step: social demands versus macro stability," International Finance Discussion Papers 974, Board of Governors of the Federal Reserve System (U.S.).
    7. Olle Folke, 2010. "Shades of brown and green: Party effects in proportional election systems," Working Papers 2010/25, Institut d'Economia de Barcelona (IEB).
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