Politics and Investment: Examining the Territorial Allocation of Public Investment in Greece

29 Pages Posted: 17 Feb 2015

See all articles by Yannis Psycharis

Yannis Psycharis

Panteion University of Athens

Andrés Rodríguez-Pose

London School of Economics & Political Science (LSE) - Department of Geography and Environment

Vassilis Tselios

London School of Economics & Political Science (LSE) - Department of Economics; Newcastle University - Centre for Urban and Regional Development Studies

Date Written: February 2015

Abstract

This paper discusses how electoral politics shapes the regional allocation of public investment expenditures per capita in Greece. Using regional public investment data for 10 political periods (1975-2009), combined with electoral data by constituency, a model is proposed which captures the influence of politics on the regional distribution of public investment expenditures. The results of the analysis point to a strong relationship between electoral results and regional public investment spending. Greek governing parties have tended to reward those constituencies returning them to office. Moreover, an increase in both the absolute and relative electoral returns of the governing party in a region has traditionally been followed by greater public investment per capita in that region. Regions where the governing party (whether Liberal or Socialist) has held a monopoly of seats have been the greatest beneficiaries of this type of pork-barrel politics.

Keywords: elections, Greece, political geography, pork-barrel politics, public investment

JEL Classification: H50, H77, R12, R58, Z18

Suggested Citation

Psycharis, Yannis and Rodríguez-Pose, Andrés and Tselios, Vassilis, Politics and Investment: Examining the Territorial Allocation of Public Investment in Greece (February 2015). CEPR Discussion Paper No. DP10422. Available at SSRN: https://ssrn.com/abstract=2566325

Yannis Psycharis (Contact Author)

Panteion University of Athens ( email )

Athens
Athens 117 45
Greece

Andrés Rodríguez-Pose

London School of Economics & Political Science (LSE) - Department of Geography and Environment ( email )

Houghton Street
London, WC2A 2AE
United Kingdom

Vassilis Tselios

London School of Economics & Political Science (LSE) - Department of Economics ( email )

Houghton Street
London WC2A 2AE
United Kingdom

Newcastle University - Centre for Urban and Regional Development Studies

Newcastle NE1 7RU
United Kingdom

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