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Bad Politicians

  • Francesco Caselli
  • Massimo Morelli

We present a simple theory of the quality (competence and honesty) of elected officials. Our theory offers four main insights. Low-quality citizens have a 'comparative advantage' in pursuing elective office, because their market wages are lower than those of high-quality citizens (competence), and/or because they reap higher returns from holding office (honesty). Hence, voters may find themselves supply constrained of high-quality candidates. Second, bad politicians generate negative externalities for good ones, making their rewards from office increasing in the average quality of office holders. This leads to multiple equilibria in quality. Third, incumbent policymakers can influence the rewards of future policymakers, leading to path dependence in quality: bad governments saw the seeds for more bad governments. Fourth, quality-constrained voters look for the optimal mix of honesty and ability, and this may lead to a negative correlation between these two qualities across political entities.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 8532.

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Date of creation: Oct 2001
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Publication status: published as Caselli, Francesco and Massimo Morelli. "Bad Politicians," Journal of Public Economics, 2004, v88(3-4,Mar), 759-782.
Handle: RePEc:nbr:nberwo:8532
Note: EFG PE
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  18. Matthias Messner & Mattias Polborn, 2003. "Paying Politicians," Working Papers 246, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  19. Osborne, Martin J & Slivinski, Al, 1996. "A Model of Political Competition with Citizen-Candidates," The Quarterly Journal of Economics, MIT Press, vol. 111(1), pages 65-96, February.
  20. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
  21. Gary S. Becker & Casey B. Mulligan, 1998. "Deadweight Costs and the Size of Government," NBER Working Papers 6789, National Bureau of Economic Research, Inc.
  22. Alberto Ades & Rafael Di Tella, 1997. "The New Economics of Corruption: a Survey and Some New Results," Political Studies, Political Studies Association, vol. 45(3), pages 496-515.
  23. Alesina, Alberto & Rosenthal, Howard, 1996. "A Theory of Divided Government," Econometrica, Econometric Society, vol. 64(6), pages 1311-41, November.
  24. Alesina, Alberto & Tabellini, Guido, 1988. "Credibility and politics," European Economic Review, Elsevier, vol. 32(2-3), pages 542-550, March.
  25. Myerson Roger B., 1993. "Effectiveness of Electoral Systems for Reducing Government Corruption: A Game-Theoretic Analysis," Games and Economic Behavior, Elsevier, vol. 5(1), pages 118-132, January.
  26. Tim Groseclose & Jeffrey Milyo, 1999. "Buying the Bums Out: What's the Dollar Value of a Seat in Congress?," Discussion Papers Series, Department of Economics, Tufts University 9923, Department of Economics, Tufts University.
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