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Businessman Candidates: Special-Interest Politics in Weakly Institutionalized Environments

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  • Scott Gehlbach

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  • Konstantin Sonin

    ()

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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Bibliographic Info

Paper provided by William Davidson Institute at the University of Michigan in its series William Davidson Institute Working Papers Series with number wp733.

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Length: pages
Date of creation: 01 Dec 2004
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Handle: RePEc:wdi:papers:2005-733

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

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Citations

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Cited by:
  1. Simeon Djankov & Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 2009. "Disclosure by Politicians," NBER Working Papers 14703, National Bureau of Economic Research, Inc.
  2. Pande, Rohini, 2008. "Understanding Political Corruption in Low Income Countries," Handbook of Development Economics, Elsevier.
  3. 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.
  4. Timothy Besley & Jose G. Montalvo & Marta Reynal‐Querol, 2011. "Do Educated Leaders Matter?," Economic Journal, Royal Economic Society, vol. 121(554), pages F205-, 08.
  5. 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.
  6. Stefano Gagliarducci & Tommaso Nannicini & Paolo Naticchioni, 2007. "Outside Income and Moral Hazard: The Elusive Quest for Good Politicians," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-164, Boston University - Department of Economics.
  7. Thomas Braendle, 2013. "Do Institutions Affect Citizens' Selection into Politics?," Working papers 2013/04, Faculty of Business and Economics - University of Basel.
  8. 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.
  9. Timothy Besley, 2005. "Political Selection," Journal of Economic Perspectives, American Economic Association, vol. 19(3), pages 43-60, Summer.
  10. Evgeny Yakovlev & Ekaterina Zhuravskaya, 2007. "Deregulation of Business," Working Papers w0097, Center for Economic and Financial Research (CEFIR).
  11. 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.
  12. Thomas Braendle & Alois Stutzer, 2011. "Selection of Public Servants into Politics," Working papers 2011/06, Faculty of Business and Economics - University of Basel.
  13. C. Simon Fan & Chen Lin & Daniel Treisman, 2010. "Embezzlement Versus Bribery," NBER Working Papers 16542, National Bureau of Economic Research, Inc.
  14. Rohini Pande & Timothy Besley & Vijayendra Rao, 2005. "Political Selection and the Quality of Evidence: Evidence form South India," Working Papers id:261, eSocialSciences.

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