Browsing by Author "Remmer, Karen L"

How do political leaders strategically manage fiscal policy formation to enhance their political survival? What are the implications of the fiscal mechanics of survival for theories of redistribution and democratic transition? This dissertation examines the complex relationship between political regime types and fiscal information asymmetries. I focus on budgetary policies (taxation and public spending) as major strategic tools available to the executive for co-optation and punishment of opponents. I argue that allowing some degree of contestation and transparency on the fiscal contract in electoral authoritarian regimes helps the executive identify distributive claims and co-opt the opposition. Paradoxically, in new democracies, political survival depends more on lower levels of budget transparency than existent theories would have us expect. Chapters 1 and 2 present a general formal model from which I derive the major hypotheses of the study. Second, Chapters 3, 4 and 5 use new cross-national measures of fiscal transparency and test empirically the theoretical implications. The statistical models confirm the main theoretical intuitions. Finally, Chapter 6 compares in greater detail the evolution of fiscal transparency in Morocco, Turkey and Romania between 1950 and 2000. I argue that fiscal taboos closely followed the shifting political alliance and their distributional consequences for leader's survival.

Special interest money enters politics in a number of ways: Politicians solicit contributions that help in their election campaigns; they enrich themselves while in office by accepting bribes; or, increasingly in many countries, they go through the "revolving door" and take up lucrative post-government jobs in companies that were affected by their decisions in office. The central argument I make in this dissertation is that these different types of special interest money can act as functional substitutes and that their prevalence is a strategic choice. I examine this strategic choice theoretically and empirically, and provide insights into the consequences it has for policy and voters. I focus on two main factors: First, what consequences does the legal environment have? Second, what is the effect of the political environment?

Chapter 1 lays the theoretical groundwork. I study a formal model of political competition that determines whether and how special interest money enters politics. I show that laws criminalizing bribery or restricting campaign contributions lead to substitution effects and make other types of special interest money more common, in particular the revolving door. I also study the effect of legal restrictions on equilibrium policy and demonstrate that it only moves policy towards the median voter under certain circumstances. Higher political competitiveness leads incumbents to solicit campaign contributions, whereas the absence of competitiveness provides leeway for personal enrichment.

I test the effect of the legal and the political environment on the types of special interest money empirically, using newly assembled data from the world's two largest democracies. Chapter 2 examines the effect of the degree of political competition on the choice between personal enrichment while in office and campaign spending in India. Making use of detailed mandatory asset disclosure data of state assembly members that run in consecutive elections, I show that candidates with ties to business groups increase their wealth to a higher degree when they are electorally secure. Conversely, they hold larger cash reserves, which are crucial in campaigns, the less electorally secure they are. Using a survey experiment, I show that the way special interest money is used matters to voters.

Chapter 3 asks where tougher regulations of money in politics comes from. I argue that political entrepreneurs running on an anti-corruption platform play an important role and provide a simple formal exposition of the conditions under which voters are willing to vote for them. The implications of the model are tested for one of the most successful electoral performances of an anti-corruption party of our time: the 2013 debut of the Aam Aadmi Party (AAP) in state elections in Delhi in India. Analyzing three rounds of pre-election surveys with a total of more than 40,000 respondents and election outcomes at the polling-booth level, I provide empirical support for the central insights of the formal model.

Finally, in Chapter 4 I study the effect of stricter regulations of bribery and campaign contributions on the revolving door, exploiting regulatory variation among the 50 state legislatures of the United States. Using a series of multilevel regression models, I show that former legislators are more likely to go through the revolving door and become lobbyists in states that make politicians less dependent on campaign contributions from special interests and that make it harder to earn money while in office. This suggests that politicians' movement into the private sector upon exiting office can act as a substitute for other types of special interest money.

How does violence affect political participation and voting behavior? Why does a violent context push some to be politically active, while others decide to stay at home? Our current understanding of political behavior is mostly derived from analyses conducted in a peaceful and democratic context, or in post-conflict periods. However, citizens in many developing countries make their political decisions in the midst of violence.

The dissertation's central argument is that political participation and voting behavior largely depend on the context surrounding the individual. In particular, the level of criminal violence greatly impacts 1) citizens' decision to participate politically, 2) their forms of participation, and 3) the logic of their vote choice. Faced with violence, voters are generally pushed away from electoral politics. I argue that those that do decide to take part of the electoral process will consider their evaluations of security when deciding to punish or reward the incumbent government. While some may be inclined to take further action and demand peace through non-electoral participation, such a decision carries certain risks that are not easily overcome. I contend that social networks can encourage participation by shaping the understanding of crime, as well as the perception of costs and benefits associated with participation amid violence.

To evaluate this argument, I draw on a rich array of sources. I designed an original post-electoral survey that took place in Mexico a few days after the 2012 presidential election. I also created a novel newspaper databank of protests against crime in Mexico during the 2006-2012 period. In addition, together with Guillermo Trejo, I developed a unique dataset on criminal violence in Mexico. My statistical evidence is complemented with participant observation in marches for peace and qualitative in-depth interviews with victims and non-victims of crime in four Mexican cities.

Statistical evidence shows that violent criminal activity depresses electoral turnout. Voters living in violent contexts are less likely to participate in elections. Victims of crime are significantly less likely to participate in elections. However, faced with rising violence, active voters are able to consider both economic and insecurity evaluations in their assessments of government performance and voting decisions. Overall, as a voter's evaluation of national security worsens, her likelihood of supporting the incumbent national party and government diminishes. At the same time, while institutional channels are not attractive to victims of crime, societal accountability mechanisms are also available to citizens affected by insecurity. Victims of crime and those connected to mobilizing networks are more likely to participate in protests against insecurity than non-victims and "socially disconnected" individuals.

The conventional wisdom in electoral studies links proportional representation to multi-party systems and plurality rules to bipartism. Although this prediction fits the dynamics of political competition well at the district level, the theoretical mechanisms proposed by the available theory are not directly relevant to the formation of party systems beyond the district level. In a similar vein to the recent literature on party system nationalization, this paper argues that electoral rules influence party systems indirectly by structuring cross-district coordination. This article argues that candidate-centered plurality rules tend to impede cross-district coordination by encouraging independents, whereas proportional representation can encourage such coordination by advantaging larger electoral coalitions. As a result, in the early stage of party system institutionalization, proportional representation can reduce the size of party systems, in contrast to plurality rules that fragment the party system. I test the argument in the setting of Polish municipal council elections. I use a regression discontinuity approach exploiting the fact that the law prescribed a population threshold below which the electoral formula was plurality rules and above which was proportional representation. Results show that councils elected by plurality rules are just as fragmented, if not more than, those elected by PR systems. Further evidence suggests PR systems empower partisans and discourages independents that thrive under plurality rules. These findings highlight the importance of understanding the complexity of the implications of electoral rules in un-institutionalized party systems.

Public opinion tools are used to look at voter motivations to engage in clientelistic practices and their variation across structures of competition.

This dissertation examines the political determinants of government spending across different levels of education. What are the political motivations that drive budgetary decisions on primary, secondary, and tertiary education? Who are the beneficiaries of these appropriations? Why are they capable of influencing the decisions over appropriations?

I argue that the distribution of education spending across education levels depends on the capacity of organized groups active in this sector to make their demands heard and served by governments. Better organized groups have stronger capacity to take advantage of the electoral concerns of politicians and influence their decisions on educational budgets. I provide evidence to show that, with some exceptions, the teachers' unions in the primary and secondary schools are the most influential organized group in the education sector. By taking their demands out to the streets, by capturing key positions in the education ministries, and by using their mobilization capacity in the electoral arena, teachers have made governments cater to their economic interests, rather than direct resources in ways that would enhance access to and the quality of education.

I test the theoretical arguments using an original dataset incorporating a comprehensive account of all protests, strikes, and other disruptive actions by teachers, university workers, students, and parents in Mexico between 1992 and 2008. The statistical analysis reveals that 1) states with higher levels of teachers' protests receive larger federal education grants, and that 2) subnational authorities spend more on primary and lower secondary as a consequence of the larger disruptive behavior observed in these education levels. Complementary qualitative evidence shows how the teachers' union has captured the education ministries at the federal and the subnational levels, consolidating its influence over education policy. Finally, this study reveals the teachers' union capacity to leverage their participation in electoral politics in order to defend its economic interests.

How does competition and rivalry within alliances affect outcomes and processes in civil wars? Towards addressing this inquiry, this dissertation presents a formal theory of alliance formation that takes into account both internal and external threats. The theory, presented in Chapter 2, focuses on how allying parties make decisions regarding resource mobilization for conflictual purposes, in the presence of both internal and external hazards. The model indicates that intra-coalition division should serve not only as a source of instability but also as a wellspring of strength for aligning militant groups. This leads to a peculiar result, whereby the internal factors enabling groups to overcome the problem of collective action may also contribute to the "conflict trap." Testable implications are derived and examined empirically via a new dataset on alliances between rebel groups during civil wars from 1944 to 2001. The series of logistical models in Chapter 3 indicates that alliances marked by rivalry and competition are indeed more likely to lead to rebel victories. Yet, the analysis also demonstrates that these types of arrangements are also significant predictors of war recurrence. The latter result holds irrespective of how the original conflicts terminate. Additionally, Chapter 4 of this dissertation presents a comparative analysis between two cases of civil war marked by competitive alliances. In addition to other factors, the cases suggest the relative size of alliance members, the influence external actors, and the presence of electoral institutions may either exacerbate or mitigate competition issues within alliances.

Ostensibly, BITs are the ideal international treaty. First, until just recently, they almost uniformly came with explicit dispute resolution mechanisms through which countries could face real costs for violation (Montt 2009). Second, the signing, ratification, and violation of them are easily accessible public knowledge. Thus countries presumably would face reputational costs for violating these agreements. Yet, these compliance devices have not dissuaded states from violating these agreements. Even more interestingly, in recent years, both developed and developing countries have moved towards modifying the investor-friendly provisions of these agreements. These deviations from the expectations of the credible commitment argument raise important questions about the field's assumptions regarding the ability of international treaties with commitment devices to effectively constrain state behavior.

This dissertation examines the variation in the choice of FDI regulations. Why do some countries restrict the entry and operations of foreign MNEs while others permit and even seek inward FDI? What factors determine the choice of FDI regulations and what conditions are likely to bring about their reform? This study identifies the political dynamics leading to the improvement or deterioration of investment climates in transition economies and beyond.

I argue that FDI policies depend on the level of political competition and the anticipated distributional implications of FDI liberalization for the main constituencies that back the government in office. Democratic governments, which derive political power from domestic workers who benefit from investments by foreign firms, liberalize FDI regulations. By contrast, non-democratic leaders, who fear that FDI would upset the balance of domestic economic power and undermine the privileged position of domestic industrialists who support the regime, continue to restrict foreign investment.

I examine the choice of FDI regulations using a newly constructed database of FDI regulations in 28 transition economies between 1989 and 2008, an index of investment freedom available for a worldwide sample starting in 1994, and changes over time in three complementary case studies. The statistical analysis reveals that higher levels of political competition are associated with greater openness to FDI and the case study research shows that both increases and decreases in the level of political competition lead to the revision of the FDI legislation. While democratization has brought about more liberal FDI policies, the consolidation of authoritarian regimes has been followed by stricter FDI regulations.

My dissertation seeks to understand how and why governments make major changes in financial sector regulations. I focus on two specific puzzles. First why is financial sector regulation not normally central to electoral competition and why are changes in financial sector regulation rare events? Second, why do we observe substantive intellectual debates and efforts of policy persuasion despite the conclusion of many researchers and observers that financial regulatory policy outcomes are driven by the preferences of powerful special interest groups? What are the mechanisms precisely by which ideas versus interests shape policy outcomes in a domain that is not often central to electoral politics? I investigate these questions through a formal game theoretical model of the regulatory policymaking process and through case studies of historic episodes of financial regulatory change in the United States which draw upon a wide variety of primary and secondary source historical materials. I conclude that financial regulatory change is most likely to occur when events of different types cause heads of government to perceive that the existing regulatory status quo threatens the realization of broader policy objectives. Heads of financial sector policy bureaucracies shape outcomes by providing cognitive frameworks through which leaders understand regulatory consequences. Interest groups influence policy outcomes primarily through their ability to act as veto players rather than by controlling the policy agenda.

The Global South, and particularly Latin America, experienced a remarkable expansion in conditional cash transfer (CCT) programs in the last fifteen years. Although a large literature examines the effects of CCTs on human development, the political behavioral consequences remain underexplored. In the dissertation, I address this gap by analyzing the effects of CCTs on political participation and policy. I also explore the implications of these effects for human development.

My central argument is that CCTs increase political participation among beneficiaries, and both program transfers and conditionalities contribute to these positive effects. More specifically, CCTs provide beneficiaries with politically relevant resources, including civic skills and access to state officials and community leaders. These resources reduce the costs of political participation and facilitate more involvement in political activities, particularly in more demanding forms of participation. In addition, I argue that CCTs increase the private provision of local services and influence the outcomes of some non-national elections.

To test this argument, I use four main sources of data: (1) existing survey data from Latin America in 2012; (2) original survey data from Mexico in 2014; (3) experimental data from Mexico in 1998-2000; and (4) in-depth interviews and focus groups from Mexico in 2012. Multilevel models and linear regression models are used to estimate the effects of CCTs on political behavior and service provision. The in-depth interviews and focus groups help to unravel more of the causal mechanism that connects CCTs to political participation.

The evidence largely supports my argument. I find that CCTs increase participation in a wide variety of political activities, including electoral and non-electoral activities. In addition, the pathways to increased participation include improved civic skills and increased access to state officials and local leaders. Moreover, CCTs increase the private provision of sewerage services.

I conclude that CCTs have both desirable and undesirable consequences. On the one hand, CCTs increase democratic political participation, improve civic skills, reduce the distance between beneficiaries and government officials, and increase access to local services. The increased access to sewerage services creates an indirect pathway to improved human development outcomes. On the other hand, CCTs reduce the pressure on local officials to provide local services, and in some contexts contribute to electoral rewards for undeserving incumbent parties.

This thesis provides a case study of the urban-rural divide and its relationship to public polices in China. By utilizing multiple data sources from both government statistics and independent surveys, this study analyzes the influences of three public policies: 1) the household registration system; 2) the education system; 3) the healthcare system, on China's urban-rural divide in terms of the income gap, the educational inequality, and the healthcare inequality. The findings show that the urban-rural gaps in income, education, and healthcare are large and have been increasing since China's market reform of the late 1970s, and there is no clear evidence that these gaps will narrow in the near future. The persistent urban-rural divide is closely associated with the strong urban bias imbedded in the public policies. Specifically, the household registration system differentiates the urban and rural populations and provides privileges to the urban population in income and education. The education and healthcare systems further strengthen the gaps through their dualistic structures and different funding schemes implemented in urban and rural areas.

Pro-urban bias in policy is often seen as a common phenomenon in the developing world. Empirical reality though is much more varied. Many governments actively support agricultural producers and rural citizens, even at early stages of development. In addition, the binary distinction between urban and rural bias in policy aggregates over important sub-national variation in the distributive impact of government policies. This dissertation extends the research frontier by analyzing the political roots underlying spatial bias in policy using new theoretical and empirical approaches. First, this dissertation develops a theory that identifies conditions under which politicians will institute pro-urban or pro-rural policies, by considering the threat of a rural insurgency. Second, I argue that elections in rural majority societies can empower citizens in the rural periphery. Competitive elections and high rural turnout induce governments to supply favorable policies to the rural sector as a whole and salient regions in particular. To test the effect of the threat of rural violence, I use new cross-national data on net taxation in the agricultural sector. Data on fiscal transfers and the sub-national effects of agricultural pricing policies in Indonesian districts provide additional evidence for the first hypothesis. To test the effect of elections on urban bias, I exploit a natural experiment from the Indonesian context. Last, I analyze the proliferation of districts in Indonesia from 2001 to 2009, with important implications for future fiscal transfers, and show the process is largely driven by local elite competition within and between districts.