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Elected Versus Appointed Policymakers: Evidence from City Treasurers

Listed author(s):
  • Alexander Whalley

This paper investigates whether methods of public official selection affect policymaking in cities. I draw on the unique characteristics of California's city referendum process to identify the causal effect of city treasurers' method of selection on their cities' debt management policies. I utilize a regression discontinuity strategy based on the effect of narrowly-passing appointive city treasurer referendums on city borrowing costs. The results indicate that appointive treasurers reduce a city's cost of borrowing by 13% to 23%. The results imply that if all cities in California with elected treasurers were to appoint them, total borrowing expenditures would be reduced by more than $20 million per year. Appointive city treasurers appear to reduce borrowing costs primarily through the refinancing of expensive debt at lower interest rates.

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File URL: http://www.nber.org/papers/w15643.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 15643.

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Date of creation: Jan 2010
Publication status: published as Alexander Whalley, 2013. "Elected versus Appointed Policy Makers: Evidence from City Treasurers," Journal of Law and Economics, University of Chicago Press, vol. 56(1), pages 39 - 81.
Handle: RePEc:nbr:nberwo:15643
Note: PE POL
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