The Power of Money. The Consequences of Electing a Donor Funded Politician
48 Pages Posted: 25 Feb 2018 Last revised: 22 Jul 2018
Date Written: March 8, 2017
This paper examines the impact of electing donor-funded politicians and campaign finance-limits using a novel dataset that uniquely links campaign donors and recipients of public contracts during a mayor's incumbency period in Colombia. Evidence shows that electing a donor-funded politician more than doubles the probability of donors receiving contracts and incumbents receiving disciplinary sanctions. Donor contracts are assigned under a minimum-value modality where there is less screening, and have a higher price compared to similar non-donor contracts. Campaign limits, lead to lower participation of donor-funding in campaigns, and as a result reduce the effect of favoring donors with contracts.
Keywords: Campaign Finance, Political Selection, Corruption, Public Procurement, Campaign Limits
JEL Classification: D72, D73, D02
Suggested Citation: Suggested Citation