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Businessman Candidates

Author

Listed:
  • Scott Gehlbach

    (University of Wisconsin-Madison)

  • Konstantin Sonin

    (NES - New Economic School - NES, CEFIR - Center for Economic and Financial Research - CEFIR, CEPR - Center for Economic Policy Research)

  • Ekaterina Zhuravskaya

    (NES - New Economic School - NES, PSE - Paris-Jourdan Sciences Economiques - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract
Why and when do businessmen run for public office rather than rely upon other means of influence? What are the implications of their participation for public policy? We show formally that "businessman candidacy" and public policy are jointly determined by the institutional environment. When institutions that hold elected officials accountable to voters are strong, businessmen receive little preferential treatment and are disinclined to run for office. When such institutions are weak, businessmen can subvert policy irrespective of whether they hold office, but they may run for office to avoid the cost of lobbying elected officials. Evidence from Russian gubernatorial elections supports the model's predictions. Businessman candidates emerge in regions with low media freedom and government transparency, institutions that raise the cost of reneging on campaign promises. Among regions with weaker institutions, professional politicians crowd out businessmen when the rents from office are especially large.

Suggested Citation

  • Scott Gehlbach & Konstantin Sonin & Ekaterina Zhuravskaya, 2010. "Businessman Candidates," Post-Print halshs-00754432, HAL.
    • Handle: RePEc:hal:journl:halshs-00754432
    DOI: 10.1111/j.1540-5907.2010.00456.x
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    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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