Tuesday, January 20, 2015

Why New York state politicians are so corrupt

Wilson’s (1966) seminal contribution argued that state-level politics was particularly prone to corruption because state capitals are often far from the major metropolitan centers, and thus face a lower level of scrutiny by citizens and by the media...

Our first contribution is to establish a basic stylized fact that is very much in line with this “accountability view”: isolated US state capital cities are associated with higher levels of corruption. A simple depiction of that can be seen in Figure 1, where our baseline measure of corruption is plotted against our baseline measure of the isolation of a state’s capital city. ...



When it comes to the media, we show that newspapers give more coverage to state politics when their readership is more concentrated around the state capital city. This is matched by individual-level patterns: individuals who live farther from the state capital are less informed and display less interest in state politics, but not in politics in general.

When it comes to elections, we find that voter turnout in state elections is greater in counties that are closer to the state capital. In addition, we also show that isolated capital cities are associated with a greater role for money in state-level elections, as measured by campaign contributions, and that, in states with a relatively isolated capital, firms and individuals who are closer to it contribute disproportionately more. ...

Finally, we provide some evidence on whether this pattern of low accountability affects the ultimate provision of public goods: states with isolated capital cities also seem to spend relatively less, and get worse outcomes, on things like education, public welfare, and health care.
--Filipe Campante and Quoc-Anh Do, American Economic Review, on the case for moving state capitals closer to population centers