Arbeitspapier

Do re-election probabilities influence public investment?

We identify exogenous variation in incumbent policymakers' re-election probabilities and explore empirically how this variation affects the incumbents' investment in physical capital. Our results indicate that a higher re-election probability leads to higher investments, particularly in the purposes preferred more strongly by the incumbents. This aligns with a theoretical framework where political parties disagree about which public goods to produce using labor and predetermined public capital. Key for the consistency between data and theory is to account for complementarity between physical capital and flow variables in government production.

Sprache
Englisch

Erschienen in
Series: CESifo Working Paper ; No. 2709

Klassifikation
Wirtschaft
Fiscal Policy
Publicly Provided Goods: General
State and Local Budget and Expenditures
Thema
political economics
strategic capital accumulation
identifying popularity shocks
Infrastrukturinvestition
Öffentliche Investition
Wiederwahl
Public Choice
Theorie

Ereignis
Geistige Schöpfung
(wer)
Fiva, Jon H.
Natvik, Gisle James
Ereignis
Veröffentlichung
(wer)
Center for Economic Studies and ifo Institute (CESifo)
(wo)
Munich
(wann)
2009

Handle
Letzte Aktualisierung
10.03.2025, 11:46 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Fiva, Jon H.
  • Natvik, Gisle James
  • Center for Economic Studies and ifo Institute (CESifo)

Entstanden

  • 2009

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