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Exposing Corrupt Politicians: The Effects of Brazil’s Publicly Released Audits on Electoral Outcomes

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Author Info
Claudio Ferraz () (IPEA, Brazil)
Frederico Finan () (University of California, Los Angeles and IZA)

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Abstract

This paper examines whether access to information enhances political accountability. Based upon the results of Brazil’s recent anti-corruption program that randomly audits municipal expenditures of federally-transferred funds, it estimates the effects of the disclosure of local government corruption practices upon the re-election success of incumbent mayors. Comparing municipalities audited before and after the elections, we show that the audit policy reduced the incumbent’s likelihood of re-election by approximately 20 percent, and was more pronounced in municipalities with radio stations. These findings highlight the value of information and the role of the media in reducing informational asymmetries in the political process.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2836.

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Length: 51 pages
Date of creation: Jun 2007
Date of revision:
Handle: RePEc:iza:izadps:dp2836

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Related research
Keywords: corruption political agency transparency information

Find related papers by JEL classification:
D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Models of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior
D78 - Microeconomics - - Analysis of Collective Decision-Making - - - Positive Analysis of Policy-Making and Implementation
H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
O17 - Economic Development, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Brunetti, Aymo & Weder, Beatrice, 2003. "A free press is bad news for corruption," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1801-1824, August. [Downloadable!] (restricted)
  2. Timothy Besley & Robin Burgess, 2002. "The Political Economy Of Government Responsiveness: Theory And Evidence From India," The Quarterly Journal of Economics, MIT Press, vol. 117(4), pages 1415-1451, November. [Downloadable!] (restricted)
    Other versions:
  3. Majumdar, Sumon & Mani, Anandi & Mukand, Sharun W., 2004. "Politics, information and the urban bias," Journal of Development Economics, Elsevier, vol. 75(1), pages 137-165, October. [Downloadable!] (restricted)
    Other versions:
  4. Dyck, Alexander & Zingales, Luigi, 2002. "The Corporate Governance Role of the Media," CEPR Discussion Papers 3630, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  5. Matthew Rabin, 1998. "Psychology and Economics," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 11-46, March. [Downloadable!] (restricted)
  6. Persson, Torsten & Roland, Gerard & Tabellini, Guido, 1997. "Separation of Powers and Political Accountability," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1163-1202, November.
    Other versions:
  7. Claudio Ferraz & Frederico Finan, 2007. "Electoral Accountability and Corruption in Local Governments: Evidence from Audit Reports," IZA Discussion Papers 2843, Institute for the Study of Labor (IZA). [Downloadable!]
  8. Alesina, Alberto & Cukierman, Alex, 1990. "The Politics of Ambiguity," The Quarterly Journal of Economics, MIT Press, vol. 105(4), pages 829-50, November. [Downloadable!] (restricted)
    Other versions:
  9. David Strömberg, 2004. "Radio's Impact on Public Spending," The Quarterly Journal of Economics, MIT Press, vol. 119(1), pages 189-221, February. [Downloadable!] (restricted)
  10. 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. [Downloadable!]
    Other versions:
  11. Grossman, Gene M & Helpman, Elhanan, 1996. "Electoral Competition and Special Interest Politics," Review of Economic Studies, Blackwell Publishing, vol. 63(2), pages 265-86, April. [Downloadable!] (restricted)
    Other versions:
  12. Rudiger Ahrend, 2002. "Press Freedom, Human Capital and Corruption," DELTA Working Papers 2002-11, DELTA (Ecole normale supérieure). [Downloadable!]
  13. Benjamin A. Olken, 2007. "Monitoring Corruption: Evidence from a Field Experiment in Indonesia," Journal of Political Economy, University of Chicago Press, vol. 115, pages 200-249. [Downloadable!] (restricted)
  14. Di Tella, Rafael & Schargrodsky, Ernesto, 2003. "The Role of Wages and Auditing during a Crackdown on Corruption in the City of Buenos Aires," Journal of Law & Economics, University of Chicago Press, vol. 46(1), pages 269-92, April.
  15. Ritva Reinikka & Jakob Svensson, 2005. "Fighting Corruption to Improve Schooling: Evidence from a Newspaper Campaign in Uganda," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 259-267, 04/05. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Ginger Zhe Jin & Alex Whalley, 2007. "The Power of Information: Do Rankings Affect the Public Finance of Higher Education?," NBER Working Papers 12941, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. Claudio Ferraz & Frederico Finan, 2007. "Electoral Accountability and Corruption in Local Governments: Evidence from Audit Reports," IZA Discussion Papers 2843, Institute for the Study of Labor (IZA). [Downloadable!]
  3. Stefan Krause & Fabio Mendez, 2007. "Corruption and Elections: An Empirical Study for a Cross-Section of Countries," Emory Economics 0709, Department of Economics, Emory University (Atlanta). [Downloadable!]
  4. Fernando Ferreira & Joseph Gyourko, 2007. "Do Political Parties Matter? Evidence from U.S. Cities," NBER Working Papers 13535, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  5. Pande, Rohini, 2007. "Understanding Political Corruption in Low Income Countries," CEPR Discussion Papers 6273, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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