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Political rents in a non-corrupt democracy

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  • Svaleryd, Helena
  • Vlachos, Jonas

Abstract

A fundamental problem in all political systems is that the people in power may extract rents to the detriment of the general public. In a democracy, electoral competition and information provided by the media may keep such rent extraction at bay. We develop a simple model where rents are decreasing in the degree of political competition and voter information. In line with our theoretical predictions, we find that both increased political competition and increased local media coverage substantially reduce direct measures of legal political rents among local governments in a non-corrupt democracy (Sweden).

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  • Svaleryd, Helena & Vlachos, Jonas, 2009. "Political rents in a non-corrupt democracy," Journal of Public Economics, Elsevier, vol. 93(3-4), pages 355-372, April.
  • Handle: RePEc:eee:pubeco:v:93:y:2009:i:3-4:p:355-372
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    Cited by:

    1. Folke, Olle & Rickne, Johanna, 2012. "Female representation but male rule? Party competition and the political glass ceiling," Working Paper Series, Center for Labor Studies 2012:9, Uppsala University, Department of Economics.
    2. Elena Costas-Pérez & Albert Solé-Ollé & Pilar Sorribas-Navarro, 2011. "Corruption scandals, press reporting, and accountability. Evidence from Spanish mayors," Working Papers 2011/9, Institut d'Economia de Barcelona (IEB).
    3. Folke, Olle & Persson, Torsten & Rickne, Johanna, 2014. "Preferential Voting, Accountability and Promotions into Political Power: Evidence from Sweden," Working Paper Series 1002, Research Institute of Industrial Economics.
    4. Solé-Ollé, Albert & Viladecans-Marsal, Elisabet, 2012. "Lobbying, political competition, and local land supply: Recent evidence from Spain," Journal of Public Economics, Elsevier, vol. 96(1), pages 10-19.
    5. Bruns, Christian & Himmler, Oliver, 2016. "Mass media, instrumental information, and electoral accountability," Journal of Public Economics, Elsevier, vol. 134(C), pages 75-84.
    6. Jon Fiva & Gisle Natvik, 2013. "Do re-election probabilities influence public investment?," Public Choice, Springer, vol. 157(1), pages 305-331, October.
    7. repec:kap:pubcho:v:172:y:2017:i:3:d:10.1007_s11127-017-0444-x is not listed on IDEAS
    8. Bernecker, Andreas, 2014. "Do politicians shirk when reelection is certain? Evidence from the German parliament," European Journal of Political Economy, Elsevier, vol. 36(C), pages 55-70.
    9. J. Stephen Ferris, 2010. "Fiscal Policy from a Public Choice Perspective," Carleton Economic Papers 10-10, Carleton University, Department of Economics.
    10. repec:spr:ecogov:v:18:y:2017:i:2:d:10.1007_s10101-016-0188-y is not listed on IDEAS
    11. Lakomaa, Erik & Korpi, Martin, 2014. "Working paper No. 240 Bloc – party Politics and Economic Outcomes. What Are the Effects of Local Parties?," Ratio Working Papers 240, The Ratio Institute.
    12. Che-Yuan Liang, 2013. "Is there an incumbency advantage or cost of ruling in proportional election systems?," Public Choice, Springer, vol. 154(3), pages 259-284, March.
    13. Bruns, Christian & Himmler, Oliver, 2014. "A Theory of Political Accountability and Journalism," MPRA Paper 59286, University Library of Munich, Germany.
    14. Björn Kauder & Manuela Krause & Niklas Potrafke, 2016. "Electoral Cycles in MPs' Salaries: Evidence from the German States," CESifo Working Paper Series 6028, CESifo Group Munich.
    15. Kai Gehring & T. Florian Kauffeldt & Krishna Chaitanya Vadlamannati, 2015. "Crime, Incentives and Political Effort: A Model and Empirical Application for India," Courant Research Centre: Poverty, Equity and Growth - Discussion Papers 170, Courant Research Centre PEG.
    16. S. Guriev & G. Egorov & K. Sonin., 2007. "Media Freedom, Bureaucratic Incentives, and the Resource Curse," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 4.
    17. Marcus Drometer, 2012. "Bureaucrats and short-term politics," Public Choice, Springer, vol. 151(1), pages 149-163, April.
    18. Bernecker, Andreas, 2013. "Do Politicians Shirk when Reelection Is Certain? Evidence from the German Parliament," Working Papers 13-09, University of Mannheim, Department of Economics.
    19. Marta Curto‐Grau & Albert Solé‐Ollé & Pilar Sorribas‐Navarro, 2017. "Does electoral competition curb party favoritism?," Working Papers 2017/04, Institut d'Economia de Barcelona (IEB).
    20. Costas-Pérez, Elena & Solé-Ollé, Albert & Sorribas-Navarro, Pilar, 2012. "Corruption scandals, voter information, and accountability," European Journal of Political Economy, Elsevier, vol. 28(4), pages 469-484.
    21. Yuriy O. Gaivoronskiy, 2015. "The Influence of Political Competition on the Efficiency of the Regional Executives in Russia," HSE Working papers WP BRP 28/PS/2015, National Research University Higher School of Economics.
    22. Sebastian Garmann, 2014. "The causal effect of coalition governments on fiscal policies: evidence from a Regression Kink Design," Applied Economics, Taylor & Francis Journals, vol. 46(36), pages 4490-4507, December.
    23. Bernardino Benito & Francisco Bastida & Ana-María Ríos & Cristina Vicente, 2014. "The causes of legal rents extraction: evidence from Spanish municipalities," Public Choice, Springer, vol. 161(3), pages 367-383, December.
    24. Rune Sørensen, 2014. "Political competition, party polarization, and government performance," Public Choice, Springer, vol. 161(3), pages 427-450, December.
    25. Schötz, Lukas, 2016. "Power and rents - political influence on rent extraction: Quasi-experimental evidence for Bavaria," Passauer Diskussionspapiere, Volkswirtschaftliche Reihe V-70-16, University of Passau, Faculty of Business and Economics.

    More about this item

    Keywords

    Accountability Political competition Media Political rents;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General

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