Skip to main content

Tying Your Enemy's Hands in Close Races: The Politics of Federal Transfers in Brazil


This article uses a regression discontinuity design in close electoral races to disclose purely political reasons in the allocation of intergovernmental transfers in a federal state. We identify the effect of political alignment on federal transfers to municipal governments in Brazil, and find that—in preelection years—municipalities in which the mayor is affiliated with the coalition (and especially with the political party) of the Brazilian president receive approximately one-third larger discretionary transfers for infrastructures. This effect is primarily driven by the fact that the federal government penalizes municipalities run by mayors from the opposition coalition who won by a narrow margin, thereby tying their hands for the next election.

Corresponding author
Fernanda Brollo is Assistant Professor, Department of Economics, University of Alicante, 03690 San Vicente del Raspeig, Alicante, Spain (
Tommaso Nannicini is Assistant Professor, Department of Economics, Bocconi University; also Research Affiliate–IGIER, Milan, and Research Fellow–IZA, Bonn; Via Rontgen, 1 – 5th Floor, Office D1.16, 20136 Milan, Italy (
Hide All
Alston, L.J., and Mueller, B.. 2006. “Pork for Policy: Executive and Legislative Exchange in Brazil.” Journal of Law Economics and Organization 22: 87114.
Ames, B. 2001. The Deadlock of Democracy in Brazil. Ann Arbor: University of Michigan Press.
Arulampalam, W., Dasgupta, S., Dhillon, A., and Dutta, B.. 2009. “Electoral Goals and Center-state Transfers: A Theoretical Model and Empirical Evidence from India.” Journal of Development Economics 88: 103–19.
Balla, S.J., Lawrence, E.D., Maltzman, F., and Sigelman, L.. 2002. “Partisanship, Blame Avoidance, and the Distribution of Legislative Pork.” American Journal of Political Science 46: 515–25.
Berry, C.R., Burden, B.C., and Howell, W.G.. 2010. “The President and the Distribution of Federal Spending.” American Political Science Review 104: 783–99.
Brollo, F. 2008. “Who Is Punishing Corrupt Politicians: Voters or the Central Government? Evidence from the Brazilian Anti-corruption Program.” IGIER working paper no. 336.
Brollo, F., Nannicini, T., Perotti, R., and Tabellini, G.. 2010. “The Political Resource Curse.” NBER working paper no. 15705.
Brollo, F., and Troiano, U.. 2012. “What Happens When a Woman Wins a Close Election? Evidence from Brazil.” University of Alicante. Mimeo.
Case, A. 2001. “Election Goals and Income Redistribution: Recent Evidence from Albania.” European Economic Review 45: 405–23.
Caselli, F., and Michaels, G.. N.d. “Do Oil Windfalls Improve Living Standards? Evidence from Brazil.” American Economic Journal: Applied Economics. Forthcoming.
Caughey, D.M., and Sekhon, J.S.. 2011. “Elections and Regression-Discontinuity Design: Lessons from Close U.S. House Races.” Political Analysis 19: 385408.
Cox, W.G. 2009. “Swing Voters, Core Voters, and Distributive Politics.” In Political Representation, eds. Shapiro, I., Stokes, S.C., Wood, E.J, and Kirshner, A.S.. Cambridge: Cambridge University Press, 342–57.
Cox, W.G., and McCubbins, M.D.. 1986. “Electoral Politics as a Redistributive Game.” Journal of Politics 48: 370–89.
De Janvry, A., Finan, F., and Sadoulet, E.. N.d. “Local Electoral Accountability and Decentralized Program Performance.” Review of Economics and Statistics. Forthcoming.
De Magalhães, L. 2012. “Incumbency Effects in Brazilian Mayoral Elections: A Regression Discontinuity Design.” CMPO working paper no. 12/284.
Dixit, A., and Londreagan, J.. 1998. “Fiscal Federalism and Redistributive Politics.” Journal of Public Economics 68: 153–80.
Eggers, A., and Hainmueller, J.. 2009. “MPs for Sale: Estimating Returns to Office in Post-war British Politics.” American Political Science Review 103: 513–33.
Ferreira, F., and Gyourko, J.. 2009. “Do Political Parties Matter? Evidence from U.S. Cities.” Quarterly Journal of Economics 124: 349–97.
Figueiredo, A.C., and Limongi, F.. 2000. “Presidential Power, Legislative Organization and Party Behavior in Brazil.” Comparative Politics 32: 151–70.
Gagliarducci, S., Nannicini, T., and Naticchioni, P.. 2011. “Electoral Rules and Politicians’ Behavior: A Micro Test.” American Economic Journal: Economic Policy 3: 144–74.
Galasso, V., and Nannicini, T.. 2011. “Competing on Good Politicians.” American Political Science Review 105: 7999.
Gordon, S. 2009. “Assessing Partisan Bias in Federal Public Corruption Prosecutions.” American Political Science Review 103: 534–54.
Grimmer, J., Hersh, E., Feinstein, B., and Carpenter, D.. 2011. “Are Close Elections Random?” Stanford University. Mimeo.
Grossman, J.P. 1994. “A Political Theory of Intergovernmental Grants.” Public Choice 69: 295303.
Hahn, J., Todd, P., and Van der Klaauw, W.. 2001. “Identification and Estimation of Treatment Effects with Regression Discontinuity Design.” Econometrica 69: 201–09.
Hainmueller, J., and Kern, H.L.. 2008. “Incumbency as a Source of Contamination in Mixed Electoral Systems.” Electoral Studies 27: 213–27.
Imbens, G., and Lemieux, T.. 2008. “Regression Discontinuity Designs: A Guide to Practice.” Journal of Econometrics 142: 615–35.
Imbens, G., and Kalyanaraman, K.. 2009. “Optimal Bandwidth Choice for the Regression Discontinuity Estimator.” NBER working paper no. 14726.
Johansson, E. 2003. “Intergovernmental Grants as a Tactical Instrument: Empirical Evidence from Swedish Municipalities.” Journal of Public Economics 87: 883915.
Kriner, D.L., and Reeves, A.. 2012. “The Influence of Federal Spending on Presidential Elections.” American Political Science Review 106: 348–66.
Larcinese, V., Rizzo, L., and Testa, C.. 2006. “Allocating the U.S. Federal Budget to the States: The Impact of the President.” Journal of Politics 68: 447–56.
Lee, D.S. 2008. “Randomized Experiments from Non-random Selection in the U.S. House Elections.” Journal of Econometrics 142: 675–97.
Lee, D.S., Moretti, E., and Butler, M.J.. 2004. “Do Voters Affect or Elect Policies? Evidence from the U.S. House,” Quarterly Journal of Economics 119: 807–59.
Levitt, D.S., and Snyder, J.M.. 1995. “Political Parties and the Distribution of Federal Outlays.” American Journal of Political Science 39: 958–80.
Lindbeck, A., and Weibull, J.W.. 1987. “Balanced-budget Redistribution as the Outcome of Political Competition.” Public Choice 52: 237–97.
Litschig, S., and Morrison, K.. 2010. “Government Spending and Re-election.” Universitat Pompeu Fabra. Mimeo.
Manacorda, M., Edward, M., and Vigorito, A.. 2011. “Government Transfers and Political Support.” American Economic Journal: Applied Economics 3: 128.
Martin, P.S. 2003. “Voting's Rewards: Voter Turnout, Attentive Publics, and Congressional Allocation of Federal Money.” American Political Science Review 47: 110–27.
Mattos, E., and Franca, V.. 2011. “Public Employment and Income Redistribution: Causal Evidence from Brazilian Municipalities.” Public Choice 146: 4373.
McCrary, J. 2008. “Manipulation of the Running Variable in the Regression Discontinuity Design: A Density Test.” Journal of Econometrics 142: 698714.
Monteiro, J., and Ferraz, C.. 2010. “Does Oil Make Leaders Unaccountable? Evidence from Brazil's Offshore Oil Boom.” PUC-Rio. Mimeo.
Myerson, R.B. 1993. “Incentives to Cultivate Favored Minorities under Alternative Electoral Systems.” American Political Science Review 87: 856–69.
Pereira, C., and Mueller, B.. 2002. “Strategic Behavior in a Coalition-Based Presidential System: Executive-Legislative Relations in Budgetary Process in Brazil.” Presented at the Annual Meeting of the American Political Science Association, Boston.
Pettersson-Lidbom, P. 2008. “Do Parties Matter for Economic Outcomes? A Regression-Discontinuity Approach.” Journal of the European Economic Association 6: 1037–56.
Sakurai, S.N., and Menezes-Filho, A.N.. 2008. “Fiscal Policy and Reelection in Brazilian Municipalities.” Public Choice 137: 301–14.
Sakurai, S.N., and Menezes-Filho, A.N.. 2011. “Opportunistic and Partisan Election Cycles in Brazil: New Evidence at the Municipality Level.” Public Choice 148: 233–47.
Samuels, D. 1998. “Political Ambition in Brazil, 1945–95: Theory and Evidence.” Presented at the 1998 meeting of the Latin American Studies Association, Chicago.
Samuels, D. 2006. “Source of Mass Partisanship in Brazil.” Latin American Politics and Society 48: 127.
Shepsle, K.A., Van Houweling, R.P., Abrams, S.J., and Hanson, P.C.. 2009. “The Senate Electoral Cycle and Bicameral Appropriations Politics.” American Journal of Political Science 53: 343–59.
Snyder, J. 2005. “Detecting Manipulation in U.S. House Elections.” University of California, Los Angeles. Mimeo.
Snyder, J.M., Folke, O., and Hirano, S.. 2011. “A Simple Explanation for Bias at the 50-50 Threshold in RDD Studies Based on Close Elections.” Harvard University. Mimeo.
Solé-Ollé, A., and Sorribas-Navarro, P.. 2008. “The Effects of Partisan Alignment on the Allocation of Intergovernmental Transfers. Differences-in-differences Estimates for Spain.” Journal of Public Economics 92: 2302–19.
Solé-Ollé, A., and Sorribas-Navarro, P.. 2009. “Does Partisan Alignment Affect the Electoral Reward of Intergovernmental Transfers?” Universitat de Barcelona. Mimeo.
Stromberg, D. 2008. “How the Electoral College Influences Campaigns and Policy: The Probability of Being Florida.” American Economic Review 98: 769807.
Veiga, G.L., and Pinho, M.M.. 2007. “The Political Economy of Intergovernmental Grants: Evidence from a Maturing Democracy.” Public Choice 133: 457–77.
Vogl, T. 2011. “Race and the Politics of Close Elections.” Harvard University. Mimeo.
Worthington, A.C., and Dollery, B.E.. 1998. “The Political Determination of Intergovernmental Grants in Australia.” Public Choice 94: 299315.
Recommend this journal

Email your librarian or administrator to recommend adding this journal to your organisation's collection.

American Political Science Review
  • ISSN: 0003-0554
  • EISSN: 1537-5943
  • URL: /core/journals/american-political-science-review
Please enter your name
Please enter a valid email address
Who would you like to send this to? *
Type Description Title
Supplementary materials

Brollo Supplementary Material

 PDF (241 KB)
241 KB


Altmetric attention score

Full text views

Total number of HTML views: 0
Total number of PDF views: 0 *
Loading metrics...

Abstract views

Total abstract views: 0 *
Loading metrics...

* Views captured on Cambridge Core between <date>. This data will be updated every 24 hours.

Usage data cannot currently be displayed