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Title: Betrayed by the elites: how corruption amplifies the political effects of recessions
Author: Sanz, Carlos
Solé Ollé, Albert
Sorribas, Pilar
Keywords: Crisis econòmiques
Corrupció política
Responsabilitat (Dret)
Political corruption
Liability (Law)
Issue Date: 2020
Publisher: Institut d’Economia de Barcelona
Series/Report no: [WP E-IEB20/02]
Abstract: We investigate whether corruption amplifies the political effects of economic crises. Using Spanish municipal-level data and a difference-in-difference strategy, we find that local unemployment shocks experienced during the Great Recession (2008-2015) increased political fragmentation. This effect was four times larger in municipalities exposed to malfeasance than in municipalities without a history of political corruption. We bolster this evidence by showing that, conditional on province and population-strata fixed effects, there is no evidence of differential pre-trends. We also find that the interaction of unemployment and corruption harms the two traditional main parties and benefits especially the new party on the left (Podemos).
Note: Reproducció del document publicat a:
It is part of: IEB Working Paper 2020/02
Appears in Collections:IEB (Institut d’Economia de Barcelona) – Working Papers

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