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American Economic Journal: Applied Economics: Vol. 3 No. 3 (July 2011)

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Government Transfers and Political Support

Article Citation

Manacorda, Marco, Edward Miguel, and Andrea Vigorito. 2011. "Government Transfers and Political Support." American Economic Journal: Applied Economics, 3(3): 1-28.

DOI: 10.1257/app.3.3.1

Abstract

This paper estimates the impact of a large anti-poverty cash transfer program, the Uruguayan PANES, on political support for the government that implemented it. Using the discontinuity in program assignment based on a pretreatment eligibility score, we find that beneficiary households are 11 to 13 percentage points more likely to favor the current government relative to the previous government. Political support effects persist after the program ends. Our results are consistent with theories of rational but poorly informed voters who use policy to infer politicians' redistributive preferences or competence, as well as with behavioral economics explanations grounded in reciprocity. (JEL D72, H23, H53, I38, O15, O17)

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Authors

Manacorda, Marco (Queen Mary, U London and London School of Economics)
Miguel, Edward (U CA, Berkeley)
Vigorito, Andrea (U Republica, Montevideo)

JEL Classifications

D72: Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
H23: Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
H53: National Government Expenditures and Welfare Programs
I38: Welfare and Poverty: Government Programs; Provision and Effects of Welfare Programs
O15: Economic Development: Human Resources; Human Development; Income Distribution; Migration
O17: Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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