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Political Transfer Cycles from the Centre to the states

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  • Ganesh Manjhi

    ()

  • Meeta Keswani Mehra

    ()

Abstract

Using the pooled-mean group method (PMG), this paper attempts to trace the political transfer cycles in parliamentary and assembly elections in India from 1980-81 to 2010-11. It is found that the political transfer cycles are more pronounced in the year before parliamentary elections and in the year of assembly elections in the case of loans from the centre. Furthermore, from the binary Logit specification it is established that opportunistic manipulations of grants from the centre, in the year before parliamentary elections and the levels of loans from the centre in the year of assembly elections can help the incumbent regain its power. Inflation is found to be electorally harmful for the incumbent as it increases the likelihood of losing the election at union level, but not necessarily at state level. Similarly, a right-wing government is more likely to win the election, whereas, if the centre and the states have the same government or if the state government is an ally, the possibility of retaining power for the union government is lowered, and it is raised in the case of state-level governments. Furthermore, a coalition government, in general, reduces the possibility of winning in both parliamentary and state elections. ****** Usando el método agrupamiento de medias (PMG), este documento intenta estimar los ciclos de las transferencias en las elecciones parlamentarias y de asambleas en India desde 1980-81 hasta 2010-11. Encontramos que dichos ciclos son más pronunciados en el año anterior a las elecciones parlamentarias y en el año de las elecciones de asambleas en el caso de los préstamos desde el centro. Adicionalmente, a partir de un modelo Logit, se pudo establecer que las manipulaciones oportunistas de las subvenciones del centro en el año anterior a las elecciones parlamentarias y los niveles de préstamos del centro en el año de las elecciones de la asamblea pueden ayudar a mantener el poder de quien actualmente lo detenta. Se encuentra que la inflación es electoralmente perjudicial para los gobernantes, ya que aumenta la probabilidad de perder las elecciones a nivel nacional, pero no necesariamente a nivel de los estados. Del mismo modo, es más probable que un gobierno de derecha gane las elecciones, mientras que, si el centro y los estados tienen el mismo gobierno o si el gobierno del estado es un aliado, la posibilidad de retener el poder para el gobierno nacional se reduce, y aumenta en el caso de los gobiernos a nivel estatal. Asimismo, un gobierno de coalición, en general, reduce la posibilidad de ganar en las elecciones parlamentarias y estatales.

Suggested Citation

  • Ganesh Manjhi & Meeta Keswani Mehra, 2018. "Political Transfer Cycles from the Centre to the states," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 36(86), pages 207-241, June.
  • Handle: RePEc:bdr:ensayo:v:36:y:2018:i:86:p:207-241
    DOI: 10.32468/espe.8604
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    1. Ganesh Manjhi & Meeta Keswani Mehra, 2018. "Political Transfer Cycles from the Centre to the states," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 36(86), pages 207-241, June.
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    Cited by:

    1. Ganesh Manjhi & Meeta Keswani Mehra, 2018. "Political Transfer Cycles from the Centre to the states," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 36(86), pages 207-241, June.
    2. K. Vinay & Brinda Viswanathan, "undated". "Political Cycles in MGNREGs Implementation," Working Papers 2020-187, Madras School of Economics,Chennai,India.

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    1. K. Vinay & Brinda Viswanathan, "undated". "Political Cycles in MGNREGs Implementation," Working Papers 2020-187, Madras School of Economics,Chennai,India.

    More about this item

    Keywords

    Opportunist Incumbent; Political Budget Cycle; Political Transfer Cycle; Indian Federation; Titular Oportunista; Ciclo Político del Presupuesto; Ciclo Político de las Transferencias; Federación India;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures

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