Politicians' Luck of the Draw: Evidence from the Spanish Christmas Lottery

Abstract

It is well known that incumbent politicians tend to receive more votes when economic conditions are good. In this paper we explore the source of this correlation, exploiting the exceptional evidence provided by the Spanish Christmas Lottery. This is a unique lottery: 75% of Spaniards play, sharing tickets, and every year at Christmas 0.3% of the Spanish GDP is at stake. Because winning tickets are mostly sold by one lottery outlet, winners tend to be geographically clustered. These features allow us to study the impact of exogenous good economic conditions on voting behavior. We find that incumbents receive significantly more votes in winning provinces. Given that individuals are well aware of the random nature of the shock, it is unlikely that this effect is due to voters wrongly attributing economic conditions to the government. Moreover, information from surveys from the same period shows that Christmas Lottery prizes increase the propensity to vote for the incumbent, but they do not affect respondents' assessment of the government. The evidence is consistent with a temporary increase in happiness making voters more lenient toward the incumbent, or with a stronger preference for the status quo.