Reelection incentives and political budget cycle: evidence from Brazil

• Autor(a) principal: Klein, Fabio Alvim
• Data de Publicação: 2010
• Tipo de documento: Artigo
• Idioma: eng
• Título da fonte: Revista de Administração Pública
• Texto Completo: https://periodicos.fgv.br/rap/article/view/6926
• topic: elections and voting; local public spending; Brazil.; eleições e voto; gasto público local; Brasil.

This article tests the presence of political budget cycle (PBC) in municipal elections in Brazil and checks whether mayors who adopt such policy have greater probability of reelection. Based on fiscal and electoral data of 5,406 Brazilian municipalities and applying the difference-in-differences econometric method as well as logistic regressions, the results provide some evidence of PBC in Brazil, although its magnitude and consistency varies depending on the years used as electoral and non-electoral years. On average, reelectable mayors spend close to 3% more in election years than nonreelectables. Moreover, reelectables who do run for reelection present a variation in spending which is close to 5% superior to that of non-reelectables and non-runners. Additionally, the results suggest that mayors who increase public spending during electoral periods have greater chances of being reelected, as long as such spending is done within deficit limits acceptable by voters.