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Political Rents in a Non-Corrupt Democracy

Author

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  • Svaleryd, Helena

    (Research Institute of Industrial Economics)

  • Vlachos, Jonas

    (Stockholm University)

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).

Suggested Citation

  • Svaleryd, Helena & Vlachos, Jonas, 2007. "Political Rents in a Non-Corrupt Democracy," Working Paper Series 698, Research Institute of Industrial Economics, revised 25 Sep 2008.
    • Handle: RePEc:hhs:iuiwop:0698
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    References listed on IDEAS

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    More about this item

    Keywords

    Accountability; Political Competition; Media; Political Rents;
    All these keywords.

    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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