Vote-Buying and Growth

CER-ETH - Center of Economic Research at ETH Zurich, Working Paper No. 08/94

33 Pages Posted: 23 Sep 2008

See all articles by Hans Gersbach

Hans Gersbach

ETH Zurich - CER-ETH -Center of Economic Reseaarch; IZA Institute of Labor Economics; CESifo (Center for Economic Studies and Ifo Institute); Centre for Economic Policy Research (CEPR)

Felix Muehe

ETH Zürich - Center for Economic Research

Date Written: September 2008

Abstract

Vote-buying is widely used by parties in developing countries to influence the outcome of elections. We examine the impact of vote-buying on growth. We consider a model with a poverty trap where redistribution can promote growth. We show that vote-buying contributes to the persistence of poverty as taxed wealthy people buy votes from poor people. We then show that there exists a democratic constitution that breaks vote buying and promotes growth. Such a constitution involves rotating agenda setting, a taxpayer-protection rule and repeated voting. The latter rule makes vote buying prohibitively costly.

Keywords: vote-buying, political economy, poverty traps, economic development, voting rules, repeated voting

JEL Classification: D72, I20, I30, O10, P16

Suggested Citation

Gersbach, Hans and Muehe, Felix, Vote-Buying and Growth (September 2008). CER-ETH - Center of Economic Research at ETH Zurich, Working Paper No. 08/94. Available at SSRN: https://ssrn.com/abstract=1271874 or http://dx.doi.org/10.2139/ssrn.1271874

Hans Gersbach (Contact Author)

ETH Zurich - CER-ETH -Center of Economic Reseaarch ( email )

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Zurich, 8092
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+41 44 632 82 80 (Phone)
+41 44 632 18 30 (Fax)

IZA Institute of Labor Economics

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Germany

CESifo (Center for Economic Studies and Ifo Institute)

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Munich, DE-81679
Germany

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Felix Muehe

ETH Zürich - Center for Economic Research ( email )

Weinbergstr. 35
Zurich 8092
Switzerland
+41 44 632 8497 (Phone)
+41 44 632 1867 (Fax)

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