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Pay for Politicians and Candidate Selection: An Empirical Analysis

Listed author(s):
  • Kaisa Kotakorpi
  • Panu Poutvaara

    ()

A growing theoretical literature on the effect of politicians’ salaries on the average level of skills of political candidates yields ambiguous predictions. In this paper, we estimate the effect of pay for politicians on the level of education of parliamentary candidates. We take advantage of an exceptional reform where the salaries of Finnish MPs were increased by 35 % in the year 2000, intended to make the pay for parliamentarians more competitive. A difference-in-differences analysis, using candidates in municipal elections as a control group, suggests that the higher salary increased the fraction of candidates with higher education among female candidates, while we find no significant effect for male candidates.

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2010/wp-cesifo-2010-07/cesifo1_wp3126.pdf
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 3126.

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Date of creation: 2010
Handle: RePEc:ces:ceswps:_3126
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  1. Stefano Gagliarducci & Tommaso Nannicini & Paolo Naticchioni, 2007. "Outside Income and Moral Hazard: The Elusive Quest for Good Politicians," Boston University - Department of Economics - The Institute for Economic Development Working Papers Series dp-164, Boston University - Department of Economics.
  2. Persson, T. & Tabellini, G., 1997. "Political Economics and Macroeconomic Policy," Papers 630, Stockholm - International Economic Studies.
  3. Francesco Caselli & Massimo Morelli, 2000. "Bad politicians," Discussion Paper / Institute for Empirical Macroeconomics 134, Federal Reserve Bank of Minneapolis.
  4. Kaisa Kotakorpi & Panu Poutvaara, 2010. "Pay for Politicians and Candidate Selection: An Empirical Analysis," CESifo Working Paper Series 3126, CESifo Group Munich.
  5. Ferraz, Claudio & Finan, Frederico S., 2008. "Motivating Politicians: The Impacts of Monetary Incentives on Quality and Performance," IZA Discussion Papers 3411, Institute for the Study of Labor (IZA).
  6. Poutvaara, Panu & Takalo, Tuomas, 2007. "Candidate quality," Munich Reprints in Economics 19785, University of Munich, Department of Economics.
  7. Persson, Torsten & Tabellini, Guido, 1999. "Political Economics and Public Finance," CEPR Discussion Papers 2235, C.E.P.R. Discussion Papers.
  8. Daniel Diermeier & Michael Keane & Antonio Merlo, 2002. "A Political Economy Model of Congressional Careers," PIER Working Paper Archive 04-037, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 01 Sep 2004.
  9. Stefano Gagliarducci & Tommaso Nannicini, 2008. "Do Better Paid Politicians Perform Better? Disentangling Incentives from Selection," Working Papers 346, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  10. Andrea Mattozzi & Antonio Merlo, 2007. "Political Careers or Career Politicians?," NBER Working Papers 12921, National Bureau of Economic Research, Inc.
  11. Rachel Croson & Uri Gneezy, 2009. "Gender Differences in Preferences," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 448-474, June.
  12. Tim Besley & Stephen Coate, "undated". ""An Economic Model of Representative Democracy''," CARESS Working Papres 95-02, University of Pennsylvania Center for Analytic Research and Economics in the Social Sciences.
  13. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-In-Differences Estimates?," The Quarterly Journal of Economics, Oxford University Press, vol. 119(1), pages 249-275.
  14. Napari, Sami, 2009. "Gender differences in early-career wage growth," Labour Economics, Elsevier, vol. 16(2), pages 140-148, April.
  15. Rafael Di Tella & Raymond Fisman, 2002. "Are Politicians Really Paid Like Bureaucrats?," NBER Working Papers 9165, National Bureau of Economic Research, Inc.
  16. Francine D. Blau & Lawrence M. Kahn, 2000. "Gender Differences in Pay," Journal of Economic Perspectives, American Economic Association, vol. 14(4), pages 75-99, Fall.
  17. Matthias Messner & Mattias Polborn, 2003. "Paying Politicians," Working Papers 246, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  18. Martin J. Osborne & Al Slivinksi, 1995. "A Model of Political Competition with Citizen-Candidates," Department of Economics Working Papers 1995-01, McMaster University.
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