Dynasties and the Political Budget Cycle

54 Pages Posted: 25 Jan 2017

See all articles by Gianmarco Daniele

Gianmarco Daniele

University of Milan - Faculty of Law; Bocconi University

Paul Vertier

affiliation not provided to SSRN

Multiple version iconThere are 2 versions of this paper

Date Written: December 12, 2016

Abstract

Families often play a significant role in representative democracies. In this paper, we test the extent to which dynastic and non-dynastic leaders differ in their policy making. Our empirical analysis focuses on local politics in Italy, using a large sample of mayors and mayoral candidates in the period 1985–2012. We highlight that dynastic candidates have more successful political careers and that power is self-perpetuating, as those in power are more likely to establish a dynasty. We then test whether dynastic mayors enforce different policies than their non-dynastic counterparts. We find no effect on average spending, revenues or transfers. Conversely, we show that dynastic mayors increase spending and obtain higher transfers during the year prior to an election, especially when they are eligible to run for re-election. We discuss mechanisms that might explain this strategic behavior.

Keywords: dynasties, political budget cycles

JEL Classification: H110

Suggested Citation

Daniele, Gianmarco and Vertier, Paul, Dynasties and the Political Budget Cycle (December 12, 2016). Available at SSRN: https://ssrn.com/abstract=2905018 or http://dx.doi.org/10.2139/ssrn.2905018

Gianmarco Daniele

University of Milan - Faculty of Law ( email )

Via Festa del Perdono, 7
20122 Milano
Italy

Bocconi University ( email )

Via Sarfatti 25
Milan, MI 20136
Italy

Paul Vertier (Contact Author)

affiliation not provided to SSRN

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