Building Networks: Investigating the Nature of Quid Pro Quo Between Politicians and Real-Estate Developers in Mumbai

44 Pages Posted: 25 Apr 2022

See all articles by Vaidehi Tandel

Vaidehi Tandel

The University of Manchester

Sahil Gandhi

The University of Manchester

Alex Tabarrok

George Mason University

Abstract

We investigate what happens when the politician-developer nexus is disrupted by an election. We find that if the incumbent party loses, real-estate project completion times increase by 5%. We investigate two mechanisms for the slowdown, delayed permits and increased litigation. We find that delayed permits explain 39% of the increased delays. Litigation against projects is common and adds to delays due to an overburdened judiciary. Politicians can delay or speed projects by initiating disputes or settling disputes outside the courts. Projects in constituencies where the majority party comes to power see a 25% decline in the likelihood of litigation.

Keywords: Real Estate Markets, India, Elections, Black Money, Corruption

Suggested Citation

Tandel, Vaidehi and Gandhi, Sahil and Tabarrok, Alex, Building Networks: Investigating the Nature of Quid Pro Quo Between Politicians and Real-Estate Developers in Mumbai. Available at SSRN: https://ssrn.com/abstract=4092330 or http://dx.doi.org/10.2139/ssrn.4092330

Vaidehi Tandel (Contact Author)

The University of Manchester ( email )

Oxford Road
Manchester, N/A M13 9PL
United Kingdom

Sahil Gandhi

The University of Manchester ( email )

Booth St West
Manchester, N/A M15 6PB
United Kingdom

Alex Tabarrok

George Mason University ( email )

4400 University Drive
Fairfax, VA 22030
United States

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