Supermajorities and Political Rent Extraction

24 Pages Posted: 16 Oct 2015

See all articles by Bjoern Kauder

Bjoern Kauder

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute

Niklas Potrafke

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute

Multiple version iconThere are 2 versions of this paper

Date Written: September 23, 2015

Abstract

Models of political competition portray political candidates as seeking the support of the median voter to win elections by majority voting. In practice, political candidates seek supermajorities rather than majorities based on support of the median voter. We study the political benefits from supermajorities using data from Bavaria, the largest German state. Members of the Bavarian parliament had been permitted to hire relatives as office employees but in the year 2000 the practice was prohibited, with exceptions that allowed continuation of employment of previously hired relatives. The circumstances provide an informative setting to relate political behavior to protection of incumbency. Our results show that the likelihood of politicians to hire relatives increased with the margin of the majority for the incumbent in the previous election. When the majority increased by one percentage point, the likelihood of hiring relatives increased by about one percentage point. Supermajorities thus facilitated political rent extraction.

Keywords: political incumbency, rents, rent extraction, nepotism, supermajority

JEL Classification: D720, H700, A130

Suggested Citation

Kauder, Bjoern and Potrafke, Niklas, Supermajorities and Political Rent Extraction (September 23, 2015). CESifo Working Paper Series No. 5512, Available at SSRN: https://ssrn.com/abstract=2674540

Bjoern Kauder

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschinger Str. 5
Munich, 01069
Germany

Niklas Potrafke (Contact Author)

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschinger Str. 5
Munich, 01069
Germany

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
19
Abstract Views
337
PlumX Metrics