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Distributive Politics and Electoral Incentives: Evidence from Seven US State Legislatures

  • Toke S. Aidt
  • Julia Shvets

We study the effect of electoral incentives on the allocation of public services across legislative districts. We develop a model in which elections encourage legislators to cater to parochial interests and thus aggravate the common pool problem. Using unique data from seven US states, we study how the amount of funding that a legislator channels to his district changes when he faces a term limit. We find that legislators bring less pork to their district when they cannot seek re-election. Consistent with the Law of 1/N, this last term reduction in funding is smaller in states with many legislative districts. (JEL D72, H70)

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Article provided by American Economic Association in its journal American Economic Journal: Economic Policy.

Volume (Year): 4 (2012)
Issue (Month): 3 (August)
Pages: 1-29

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Handle: RePEc:aea:aejpol:v:4:y:2012:i:3:p:1-29
Note: DOI: 10.1257/pol.4.3.1
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  1. Daniel Sturm & John List, 2004. "How Elections Matter: Theory and Evidence from Environmental Policy," Natural Field Experiments 00482, The Field Experiments Website.
  2. Stephen Coate & Marco Battaglini, 2005. "Inefficiency in Legislative Policy-Making: A Dynamic Analysis," 2005 Meeting Papers 209, Society for Economic Dynamics.
  3. Reza Baqir, 2002. "Districting and Government Overspending," Journal of Political Economy, University of Chicago Press, vol. 110(6), pages 1318-1354, December.
  4. Claudio Ferraz & Frederico Finan, 2009. "Electoral Accountability and Corruption: Evidence from the Audits of Local Governments," NBER Working Papers 14937, National Bureau of Economic Research, Inc.
  5. Sanjit Dhami, 2001. "The Political Economy of Redistribution Under Asymmetric Information," Game Theory and Information 0108001, EconWPA.
  6. W. Robert Reed, 1994. "A Retrospective Voting Model With Heterogeneous Politicians," Economics and Politics, Wiley Blackwell, vol. 6(1), pages 39-58, 03.
  7. Alesina, Alberto & Spear, Stephen E., 1988. "An overlapping generations model of electoral competition," Journal of Public Economics, Elsevier, vol. 37(3), pages 359-379, December.
  8. Eric Maskin & Jean Tirole, 2004. "The Politician and the Judge: Accountability in Government," Economics Working Papers 0020, Institute for Advanced Study, School of Social Science.
  9. Timothy Besley & Anne Case, 1995. "Does Electoral Accountability Affect Economic Policy Choices? Evidence from Gubernatorial Term Limits," The Quarterly Journal of Economics, Oxford University Press, vol. 110(3), pages 769-798.
  10. Chiara Dalle Nogare & Roberto Ricciuti, 2008. "Term Limits: Do they really Affect Fiscal Policy Choices?," CESifo Working Paper Series 2199, CESifo Group Munich.
  11. Per Pettersson-Lidbom, 2004. "Does the Size of the Legislature Affect the Size of Government? Evidence from Two Natural Experiments," Discussion Papers 350, Government Institute for Economic Research Finland (VATT).
  12. Toke Aidt & Julia Shvets, 2011. "Distributive Politics and Electoral Incentives: Evidence from Seven US State Legislatures," CESifo Working Paper Series 3405, CESifo Group Munich.
  13. Bernhardt, Dan & Dubey, Sangita & Hughson, Eric, 2004. "Term limits and pork barrel politics," Journal of Public Economics, Elsevier, vol. 88(12), pages 2383-2422, December.
  14. Gilligan, Thomas W & Matsusaka, John G, 1995. "Deviations from Constituent Interests: The Role of Legislative Structure and Political Parties in the States," Economic Inquiry, Western Economic Association International, vol. 33(3), pages 383-401, July.
  15. Leah Brooks & Justin Phillips & Maxim Sinitsyn, 2011. "The Cabals of a Few or the Confusion of a Multitude: The Institutional Trade-Off between Representation and Governance," American Economic Journal: Economic Policy, American Economic Association, vol. 3(1), pages 1-24, February.
  16. Brian Knight, 2005. "Estimating the Value of Proposal Power," American Economic Review, American Economic Association, vol. 95(5), pages 1639-1652, December.
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