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The Effects of Social Capital on Government Performance and Turnover: Theory and Evidence from Italian Municipalities

Author

Listed:
  • Lockwood, Ben

    (University of Warwick)

  • Porcelli, Francesco

    (Universit`a di Bari)

  • Redoano, Michela

    (University of Warwic)

  • Bracco, Emanuele

    (Universit`a di Verona)

  • Liberini, Federica

    (University of Bath)

  • Sgroi, Daniel

    (University of Warwick)

Abstract

This paper makes three contributions. First, it presents a theoretical analysis of how both the civic preference and information aspects of social capital impact on government performance and turnover, employing a political agency model with both moral hazard and adverse selection. Second, it presents novel measures of both local government performance and on social capital at the Italian municipality level, using administrative data and an online survey respectively. Third, empirical results show that higher social capital improves government performance, especially in the first term of office, but also increases turnover of incumbent mayors, as predicted by the theory. The voting rule predicted by the theory has the feature that the level effect of social capital on the incumbent vote share is negative, but the interaction between social capital and performance is positive. Our empirical results also support this prediction.

Suggested Citation

  • Lockwood, Ben & Porcelli, Francesco & Redoano, Michela & Bracco, Emanuele & Liberini, Federica & Sgroi, Daniel, 2020. "The Effects of Social Capital on Government Performance and Turnover: Theory and Evidence from Italian Municipalities," The Warwick Economics Research Paper Series (TWERPS) 1284, University of Warwick, Department of Economics.
    • Handle: RePEc:wrk:warwec:1284
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    File URL: https://warwick.ac.uk/fac/soc/economics/research/workingpapers/2020/twerp_1284_-_lockwood.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Social Capital ; Voting ; Elections ; Government Efficiency JEL codes: H41 ; H72 ; D72;
    All these keywords.

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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