Does Opportunism Pay Off?

This article tests the hypothesis that the opportunistic manipulation of financial accounts by mayors increases their chances of re-election. Working with a large and detailed dataset comprising all Portuguese mainland municipalities, which covers the municipal elections that took place from 1979 to 2001, we clearly show that increases in investment expenditures and changes in the composition of spending favouring highly visible items are associated with higher vote percentages for incumbent mayors seeking re-election. Our results also indicate that the political payoff to opportunistic spending increased after democracy became well-established in the country.Voting functions, opportunism, local governments, elections, Portugal.

Popularity functions, partisan effects and support in Parliament

This paper analyzes the popularity of the main political entities in Portugal. After describing the recent evolution and structure of the Portuguese political system, we present estimations of popularity functions for the Assembly, Government, Prime Minister, and President using several estimation techniques to incorporate the timeseries and cross-equation aspects of the models. The results strongly favor the responsibility hypothesis, with unemployment, and to a lesser extent inflation, affecting popularity levels. There is also evidence that voters’ evaluations of incumbents’ economic performance depends on the ideology and support in Parliament of the latter. Finally, there is evidence of popularity erosion over consecutive terms and of honeymoon effects.

Political Business Cycles at the Municipal Level

This article tests for the existence of rational political business cycles models using a large and unexplored data set of Portuguese municipalities. The data set is well-suited for this purpose because it provides a high level of detail on expenditure items, because Portuguese municipalities are homogeneous with respect to policy instruments and institutions and follow an exogenously determined election schedule. Estimation results clearly reveal the existence of opportunistic behaviour by local governments. Expenditures increase in pre-election periods, especially on items that are highly visible to the electorate (e.g., highways and streets). This suggests an effort to signal competence and improve chances of re-election.Political business cycles, public finance, local governments.

The determinants of vote intentions in Portugal

This paper offers additional insights on the interactions between economics and politics in Portugal. We use an unexplored data set consisting of monthly polls on vote intentions for the main political parties in Portugal, since 1986. Results indicate that: (1) socialist governments had less electoral support than social democratic governments; (2) social democratic governments enjoyed a honeymoon period with the electorate while socialist governments did not; (3) vote intentions for incumbent parties tend to decrease with time in office; (4) voters hold incumbents responsible for the evolution of the economy; (5) the socialists are more penalized for rises in unemployment than are the social democrats.voting functions, responsibility hypothesis, Portugal, vote intentions.

Descentralização orçamental: questões de autonomia e responsabilização

Durante as últimas décadas, vários países empreenderam reformas no sentido de descentralizar as atividades do Estado, atribuindo maior responsabilidade e autonomia aos governos locais e regionais. De 1995 a 2009, o peso das despesas realizadas por estes níveis de governo no total da despesa pública aumentou na generalidade dos países da União Europeia, em particular na Espanha, Dinamarca, Suécia, República Checa, Itália e Alemanha. A crise das dívidas soberanas vivida nos últimos anos e a necessidade de adotar medidas de austeridade levou a um retrocesso no processo de descentralização em diversos países. Verificou-se também um crescente interesse em estudar a descentralização orçamental e, em particular, se esta promove a disciplina orçamental.COMPETE, QREN, FEDER, Fundação para a Ciência e a Tecnologia (FCT

Voting functions in the EU-15

This paper examines if the European integration process, by transferring policy instruments to supra-national authorities, has affected voters’ evaluations of governments’ economic performance at electoral periods. The analysis is implemented on a panel of 15 EU countries, from 1970 to 2011. Results suggest that before the Maastricht Treaty, citizens held incumbents responsible for GDP growth, and for the evolution of inflation, particularly when measured relative to the EU average. After the Maastricht Treaty, only fiscal policy variables show up as statistically significant. The capacity to control the budget deficit appears as the main determinant of electoral results, especially during the current economic crisis.COMPETE; QREN; FEDER; Fundação para a Ciência e a Tecnologia (FCT

Determinants of the assignment of E.U. funds to portuguese municipalities

The paper examines the determinants of the assignment of EU funds to Portuguese municipalities using a large and unexplored dataset covering all (278) mainland municipalities over fifteen years. Empirical results reveal that besides normative objectives, the national government also takes into account political motivations in the distribution of funds to municipalities. Grants increase during local election years, more funds are transferred to municipalities where the government party had higher percentages of votes, and where there are more swing voters.Fundação para a Ciência e a Tecnologia (FCT) - PTCD/ECO/65711/2006FEDE

Who cares about unemployment and inflation in Western Europe?

Working with a sample of 13 European nations from 1960 to 1997, this paper compares voters’ and policymakers’ attitudes towards unemployment and inflation. Empirical work on vote functions shows that inflation is the most important determinant of electoral results and unemployment is the least important. Reasons for the emergence of a neo-liberal consensus among European policymakers are discussed and empirically tested. The spread of these conservative ideas and the willingness to achieve a monetary union are suggested as possible explanations for why governments go unpunished for the increase and persistence of unemployment in Europe

The political economy of local governments' expenditures

Although the literature on the political economy of public finance is already quite extensive, most articles analyse the behaviour of central governments. Furthermore, studies about the Portuguese economy are scarce. The present article contributes for a better understanding of these phenomena by testing the influence of political factors on municipal expenditure decisions in Portugal. The dataset used in the empirical work has information for all mainland Portuguese municipalities from 1979 to 2000. The tests performed reveal that local politicians increase capital expenditures before elections, particularly on roads and streets construction. Results also indicate that when the mayor belongs to the party that dominates the municipal assembly capital expenditures are higher. Finally, no support was found for partisan effects on incumbents’ investment expenditures choices.Fundação para a Ciência e Tecnologia (FCT) - Programa Operacional Ciência, Tecnologia e Inovação (POCTI)

Economic determinants of citizens’ support for the European Union

We investigate the determinants of public support for EU membership using a panel of fifteen countries over the 1974 - 2008 period. The results indicate that increases in inflation and unemployment rate generate a decrease in support for EU membership, while growth of GDP growth increases support. There is evidence of erosion in citizens’ support as time in the Union accumulates and when the country is under the excessive deficit procedure. Splitting the sample into different periods reveals that real economic variables were more influential in shaping citizens’ support for the EU than nominal variables during the first years of the Community, but inflation became the most relevant variable after implementation of the Treaty of the European Union.European integration, public support, economic performance, panel-data