Template-Type: ReDIF-Paper 1.0


Author-Name: Marco Bertoni
Author-X-Name-First: Marco
Author-X-Name-Last: Bertoni

Author-Name: Giorgio Brunello
Author-X-Name-First: Giorgio
Author-X-Name-Last: Brunello

Author-Name: Lorenzo Cappellari
Author-X-Name-First: Lorenzo
Author-X-Name-Last: Cappellari

Author-Email: lorenzo.cappellari@unicatt.it
Author-Workplace-Name: Università Cattolica del Sacro Cuore
Author-Workplace-Name: Dipartimento di Economia e Finanza, Università Cattolica del Sacro Cuore

Author-Name: Maria De Paola
Author-X-Name-First: Maria
Author-X-Name-Last: De Paola



Title: The long-run earnings effects of winning a mayoral election.


Abstract: We estimate the effect of winning a mayoral election on long-run licit earnings, which plays a key role in the selection of local political leaders. We use Italian administrative social security data from 1995 to 2017 and a sharp regression discontinuity design based on close elections. Over a 15-year horizon, the average present discounted value of winning an election is equal to 35,000€, or 85 percent of the annual labor and social security earnings for the average candidate in our sample, a modest effect driven by the compensations for political service and concentrated during the first five years after the election. Net of compensations for service, this effect is negative during the first ten years after the election, and almost fades away afterwards. Differences in the political careers of winners and runners-up and a two-term limit rule on mayors’ office contribute to explain our results. 
Length: 70
Creation-Date: 2023-01
File-URL: http://dipartimenti.unicatt.it/economia-finanza-def123.pdf
File-Format: Application/pdf
File-Function: First version, 2023
Number: def123
Classification-JEL: D72; J44; J45. 
Keywords: returns to office; political selection; revolving door; rent-seeking; close elections.
Handle: RePEc:ctc:serie1:def123