Successful Social Programs over Local Political Cycles

Pan, Yao and You, Jing (2020): Successful Social Programs over Local Political Cycles.

Abstract

We identify the effect of the relative timing of program introduction to local elections on service delivery. Exploring randomized provision of a credit program in China and variations in local political cycles, we find villages introducing the program before elections experience higher take-up rates, better targeting of the poor, and improved welfare, all of which are achieved without compromising the program’s financial sustainability. Examining implementation phase-by-phase shows better-designed program practices and greater efforts made by local politicians are plausible contributors to enhanced program impacts. These findings are consistent with incentives to implement well rather than buying votes under election pressure.

• Item Type: MPRA Paper
• Language: English
• Keywords: Microfinance; Political Cycle; Heterogeneous Impact; Randomized Controlled Trial
• Subjects: D - Microeconomics > D1 - Household Behavior and Family Economics > D14 - Household Saving; Personal Finance; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D72 - Political Processes: Rent-Seeking, Lobbying, Elections, Legislatures, and Voting Behavior; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages; I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and Poverty > I38 - Government Policy ; Provision and Effects of Welfare Programs; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O13 - Agriculture ; Natural Resources ; Energy ; Environment ; Other Primary Products; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O14 - Industrialization ; Manufacturing and Service Industries ; Choice of Technology; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O16 - Financial Markets ; Saving and Capital Investment ; Corporate Finance and Governance

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