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Party Expertise, Campaign Donation and Government Contracts: Evidence from an Electoral Quasi-Experiment
Ano: 2018 Código: WPE – 377 Autores/Pesquisadores:
Paulo Arvate, Klenio Barbosa e Eric Fuzitani.
This paper establishes that party expertise – defined as experience gained from time in congress – is an essential element for firms that are politically connected to legislators. By employing a regression discontinuity design that exploits the quasi-random assignment of seats in Brazilian state legislatures, we estimate the additional public contracts that companies obtain for having contributed to legislators’ electoral campaigns. Our estimations show
that an electoral victory of a candidate from an expert party substantially raises the value of contracts for its donors – at least four times the value of contracts of the defeated candidates’ donors. No effect was found on the contracts for donors of candidates from non-expert parties. The extra contracts obtained through campaign donation are explained by experience of the party staff members of state legislatures, but not by reelection of individual politicians or by other party characteristics like size and closeness to the executive government. Expertise built by party staff members is crucial for donors’ benefits from campaign contributions.