Partnership Communities: Public-Private Partnerships, Democratic Institutions, Electoral Accountability and Infrastructure Around the World
Cambridge University Press, Elements series
with A. M. Bertelli, E. F. Woodhouse and P. Belardinelli
Abstract – We undertake the first quantitative and broadly comparative study of the structure and performance of partnership communities to our knowledge. Our study addresses several important research questions. How connected are the members of partnership communities? How can we understand the quality of the projects a community undertakes? How do political institutions shape their structure and performance? After defining partnership communities as networked communities of private firms which form the consortia that enter into long-term contractual arrangements with governments, we show how they are affected by government demand for partners. We then provide an overview of those factors predicting success in financing projects. Finally, we focus on the political economy of partnership communities. We develop and test theoretical predictions about how national political institutions shape partnership communities and the quality of projects. We also investigate voters’ preferences over alternative arrangements of infrastructure delivery before drawing out implications for research and practice.
Reforming the Nepotistic State? The Direct and Indirect Effects of Anti-Nepotism Bans
Abstract – Hiring family members in the government – a practice known as nepotism – increases a politician’s control of the bureaucracy at the expense of institutional trust and efficiency. Governments worldwide have passed anti-nepotism laws, but their effectiveness is not well established. I evaluate such an intervention in Brazil. Using administrative data for the universe of local public employees’ contracts (over 50 million over 11 years), I assess the reform’s direct and indirect effects. Empirically, I use a Regression Discontinuity design to show that winning municipal races translates into a significant advantage amounting to an additional 3.7 hires per thousand hires (3 times the sample mean). Combining a set of non-parametric tests and a two-period Difference-in-Differences design, I show that the reform reduces nepotistic hires by 1.2 hires within municipalities, though increasing them by 0.8 across them – an unforeseen effect stemming from the strategic displacement of discretionary hiring. This paper contributes to the scholarship on the political capture of the bureaucracy by developing a scalable measure of nepotism and discussing the limits of encompassing regulations to curb it.
Political scandals and corporate political participation. Analysis of straw-man donations in Brazil.
Abstract – Curtailing corporate participation in electoral campaigns, in principle, improves electoral ac- countability by reducing the number of principals to whom politicians have to respond. Not sur- prisingly, the practice is widespread. Reforms in that direction, however, are not straightforward to implement and present clear conundrums with respect to corruption displacement. In settings with high-returns to political connections, corporate actors are unwilling to relinquish control over politicians and resources willfully, and might oppose change, directly and indirectly. I approach the issue of campaign regulation effectiveness by focusing on the latter, specifically ad- dressing the emergence of straw donor schemes – in which corporate actors circumvent restriction by employing private donors as intermediaries.
Empirically, I exploit a corporate donation ban in Brazil and study how it affected corporations’ ability to signal support by means of private-for-corporate donations of their employees. Employ- ing a Difference-in-Differences strategy and leveraging pre-intervention heterogeneity in firms’ donation patterns, I show that firms with a history of political participation orchestrate a clearer signal to politicians with respect to comparable firms without such record. Two measure of do- nation orchestration are developed as adaptation of the Herfindahl-Hirschman Index: a within- and an across-candidates contributions concentration index. The papers shows that drastic cam- paign reform does affect the ability of firms to maintain speech in the political arena. The study concludes that the all-encompassing ban was counterproductive, especially because implemented at the cost of electoral transparency and accountability.
Ideological- and Non-Ideological-Camp Effects on Local Resource Misallocation. Evidence from Italy.
Abstract – The political determinants of public resource allocation are of central importance for both the political science literature and public interest. Despite the relevance of this topic for any government, the effect that ideological affiliation has on budgetary decisions remains substantially under-explored at the local level. Given the paramount importance of local government for individuals’ experience of the state and for a country’s administration, the topic calls for renewed attention. This study advances the discussion on ideology-driven resource allocation and presents previously unavailable evidence regarding the de- gree of mismanagement of public resources across ideological camps at the municipal level. The use of accounting tricks that surreptitiously dismantle spending constraints at the cost of debt accumulation and at the risk of economic default (i.e. over-inflated receivables), proxies the phenomenon. The study exploits a data-driven Regression Discontinuity design on margins of victory at the municipal level, com- paring camps pairwise – with a focus on non-ideological candidates. The empirical context chosen is Italy where non-ideological candidates have long been key players in local elections. Non-ideological admin- istrations are expected to fare better than their counterparts, but evidence of this is not found in the data. Moreover, locally liberal and conservative camps do not differ in the abuse of accounting instruments, which is in line with a substantial part of the literature. Overall, this piece sheds light on unexplored bud- getary mechanics underpinning government consumption and advances the discussion about the costs of reproducing an ideologically driven public purse configuration at different levels of government; pre- senting a novel setting with a unique ideological camp configuration, it contributes substantially to an emerging literature worldwide.