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Political competition and the allocation of public investment in Mexico

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  • Rodriguez-Oreggia, Eduardo

    ()

  • Costa-Font, Joan

    ()

  • Luna Pla, Dario

Abstract

This paper examines the causality between central government spending in regions and local elections, in an environment of increasing electoral competition and a undefined decentralisation. This study examines Mexican elections during the period 1990-1995 where the main party started loosing part of its influence and there were many claims of use of the budget to favour the central governing party. We employ data on public investment and municipalities ruled by the PRI in each Mexican region. The evidence shows that there is opportunistic behaviour of the central government using public investment to gain local control of pressures for decentralisation.

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Bibliographic Info

Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa02p260.

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Date of creation: Aug 2002
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Handle: RePEc:wiw:wiwrsa:ersa02p260

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  1. Alesina, Alberto F & Cohen, Gerald D & Roubini, Nouriel, 1992. "Macroeconomic Policy and Elections in OECD Democracies," CEPR Discussion Papers 608, C.E.P.R. Discussion Papers.
  2. Nordhaus, William D, 1975. "The Political Business Cycle," Review of Economic Studies, Wiley Blackwell, vol. 42(2), pages 169-90, April.
  3. Rogers, Diane Lim & Rogers, John H, 2000. " Political Competition and State Government Size: Do Tighter Elections Produce Looser Budgets?," Public Choice, Springer, vol. 105(1-2), pages 1-21, October.
  4. Kydland, Finn E & Prescott, Edward C, 1977. "Rules Rather Than Discretion: The Inconsistency of Optimal Plans," Journal of Political Economy, University of Chicago Press, vol. 85(3), pages 473-91, June.
  5. Wallace E. Oates, 1968. "The Theory of Public Finance in a Federal System," Canadian Journal of Economics, Canadian Economics Association, vol. 1(1), pages 37-54, February.
  6. 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.
  7. William D. Nordhaus, 1989. "Alternative Approaches to the Political Business Cycle," Cowles Foundation Discussion Papers 927, Cowles Foundation for Research in Economics, Yale University.
  8. Migue, Jean-Luc, 1997. " Public Choice in a Federal System," Public Choice, Springer, vol. 90(1-4), pages 235-54, March.
  9. Besley, Timothy & Case, Anne, 1995. "Does Electoral Accountability Affect Economic Policy Choices? Evidence from Gubernatorial Term Limits," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 769-98, August.
  10. Tabellini, Guido & Alesina, Alberto, 1990. "A Positive Theory of Fiscal Deficits and Government Debt," Scholarly Articles 3612769, Harvard University Department of Economics.
  11. Becker, Gary S, 1983. "A Theory of Competition among Pressure Groups for Political Influence," The Quarterly Journal of Economics, MIT Press, vol. 98(3), pages 371-400, August.
  12. Petchey, Jeffrey, 2000. " Political Competition and Voter Mobility," Public Choice, Springer, vol. 105(3-4), pages 231-43, December.
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