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Wedded to Prosperity? Informal Influence and Regional Favoritism

Author

Listed:
  • Bomprezzi, Pietro
  • Dreher, Axel
  • Fuchs, Andreas
  • Hailer, Teresa
  • Kammerlander, Andreas
  • Kaplan, Lennart
  • Marchesi, Silvia
  • Masi, Tania
  • Robert, Charlotte
  • Unfried, Kerstin

Abstract

We investigate the informal influence of political leaders' spouses on the subnational allocation of foreign aid. Building new worldwide datasets on personal characteristics of political leaders and their spouses as well as on geocoded development aid projects (including new data on 19 Western donors), we examine whether those regions within recipient countries that include the birthplace of leaders' spouses attract more aid during their partners' time in office. Our findings for the 1990-2020 period suggest that regions including the birthplaces of political leaders' spouses receive substantially more aid from European donors, the United States, and China. We find that more aid goes to spousal regions prior to elections and that developmental outcomes deteriorate rather than improve as a consequence. For Western aid but not for China, these results stand in some contrast to those for leader regions themselves. This suggests that aid from Western donors is directed from serving obvious political motives to promoting more hidden ones.

Suggested Citation

  • Bomprezzi, Pietro & Dreher, Axel & Fuchs, Andreas & Hailer, Teresa & Kammerlander, Andreas & Kaplan, Lennart & Marchesi, Silvia & Masi, Tania & Robert, Charlotte & Unfried, Kerstin, 2024. "Wedded to Prosperity? Informal Influence and Regional Favoritism," CEPR Discussion Papers 18878, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:18878
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    More about this item

    Keywords

    ODA; Favoritism; Birth regions; Political economy of development;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • F35 - International Economics - - International Finance - - - Foreign Aid
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • P33 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - International Trade, Finance, Investment, Relations, and Aid
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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