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Supermajorities and Political Rent Extraction

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  • Björn Kauder
  • Niklas Potrafke

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Abstract

Models of political competition portray political candidates as seeking the support of the median voter to win elections by majority voting. In practice, political candidates seek supermajorities rather than majorities based on support of the median voter. We study the political benefits from supermajorities using data from Bavaria, the largest German state. Members of the Bavarian parliament had been permitted to hire relatives as office employees but in the year 2000 the practice was prohibited, with exceptions that allowed continuation of employment of previously hired relatives. The circumstances provide an informative setting to relate political behavior to protection of incumbency. Our results show that the likelihood of politicians to hire relatives increased with the margin of the majority for the incumbent in the previous election. When the majority increased by one percentage point, the likelihood of hiring relatives increased by about one percentage point. Supermajorities thus facilitated political rent extraction.

Suggested Citation

  • Björn Kauder & Niklas Potrafke, 2015. "Supermajorities and Political Rent Extraction," CESifo Working Paper Series 5512, CESifo Group Munich.
  • Handle: RePEc:ces:ceswps:_5512
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Debski, Julia & Jetter, Michael & Mösle, Saskia & Stadelmann, David, 2018. "Gender and corruption: The neglected role of culture," European Journal of Political Economy, Elsevier, vol. 55(C), pages 526-537.
    2. David Stadelmann & Marco Portmann & Reiner Eichenberger, 2018. "Military Service of Politicians, Public Policy, and Parliamentary Decisions," CESifo Economic Studies, CESifo, vol. 64(4), pages 639-666.
    3. Arye L. Hillman & Heinrich W. Ursprung, 2016. "Where are the rent seekers?," Constitutional Political Economy, Springer, vol. 27(2), pages 124-141, June.
    4. 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.
    5. Björn Kauder & Niklas Potrafke & Marina Riem, 2017. "Do Parties Punish MPs for Voting Against the Party Line?," CESifo Economic Studies, CESifo, vol. 63(3), pages 317-332.
    6. Felix Arnold & Ronny Freier & Magdalena Pallauf & David Stadelmann, 2016. "Voting for direct democratic participation: evidence from an initiative election," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 23(4), pages 716-740, August.
    7. Björn Kauder & Niklas Potrafke & Alexander Stecher, 2015. "Stell doch einfach Deine Frau an! Die Verwandtenaffäre in Bayern – der Untersuchung zweiter Teil," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 68(20), pages 20-24, October.
    8. Arye L. Hillman & Heinrich Ursprung, 2016. "Where are the Rent Seekers?," CESifo Working Paper Series 5833, CESifo Group Munich.

    More about this item

    Keywords

    political incumbency; rents; rent extraction; nepotism; supermajority;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values

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