2002/03/01 by Matz Dahlberg, Eva Johansson · 551 citations
Social Sciences · Economics, Econometrics and Finance · #Local Government Finance and Decentralization #Fiscal Policy and Economic Growth #Fiscal Policies and Political Economy #Government (linguistics) #Purchasing #Distribution (mathematics) #Power (physics) #Purchasing power #Business #Economics #Public economics #Microeconomics #Marketing #Macroeconomics
paper · doi:10.1017/s0003055402004215
published in American Political Science Review 96(1), 27-40 (Cambridge University Press)
openalex publication_date 2002/03/01 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/31
In this paper we investigate whether there are any tactical motives behind the distribution of grants from central to lower-level governments. We use a temporary grant program that is uniquely suitable for testing theories of vote-purchasing behavior of incumbent governments. The temporary grant program differs from traditional intergovernmental grants in several aspects, most importantly in the sovereign decision-making power given to the incumbent central government. We find support for the hypothesis that the incumbent government used the grant program under study to win votes. In particular, we find strong support for the Lindbeck–Weibull/Dixit–Londregan model, in which parties distribute transfers to regions where there are many swing voters. This result is statistically as well as economically significant. We do not, however, find any support for the model that predicts that the incumbent government transfers money to its own supporters.