Returns to Office in National and Local Politics

41 Pages Posted: 14 Jan 2014

See all articles by Kaisa Kotakorpi

Kaisa Kotakorpi

University of Turku - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)

Panu Poutvaara

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics; ifo Institut - Leibniz-Institut fuer Wirtschaftsforschung an der Universitaet Muenchen e.V.; CESifo (Center for Economic Studies and Ifo Institute); CReAM; IZA Institute of Labor Economics

Marko Terviö

Aalto University

Multiple version iconThere are 3 versions of this paper

Date Written: December 30, 2013

Abstract

We study the returns to political office using data from Finnish parliamentary elections in 1970-2007 and municipal elections in 1996-2008. The discontinuity of electoral outcomes in individual candidate votes allows us to estimate the causal effect of being elected on subsequent income. Getting elected to parliament increases annual earnings initially by about €20,000, but most of this effect fades out over time. Getting elected to a municipal council has a positive effect of about €1,000 on subsequent annual earnings.

Keywords: returns to office, elections, regression discontinuity

JEL Classification: D720

Suggested Citation

Kotakorpi, Kaisa and Poutvaara, Panu and Terviö, Marko, Returns to Office in National and Local Politics (December 30, 2013). CESifo Working Paper Series No. 4542, Available at SSRN: https://ssrn.com/abstract=2378294

Kaisa Kotakorpi

University of Turku - Department of Economics ( email )

Turku
Finland

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Panu Poutvaara (Contact Author)

Ludwig Maximilian University of Munich (LMU) - Faculty of Economics ( email )

Ludwigstrasse 28
Munich, D-80539
Germany

HOME PAGE: http://www.iiv.vwl.uni-muenchen.de/index.html

ifo Institut - Leibniz-Institut fuer Wirtschaftsforschung an der Universitaet Muenchen e.V. ( email )

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CESifo (Center for Economic Studies and Ifo Institute) ( email )

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CReAM ( email )

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IZA Institute of Labor Economics ( email )

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Marko Terviö

Aalto University ( email )

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Helsinki, 00101
Finland

HOME PAGE: http://hse-econ.fi/tervio

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