Oil Income, Political Incentives, and Public Goods in Brazil

• In Event: The Micro-level Politics of the Resource Curse

Abstract

The cross-national literature on the ‘resource course’ is voluminous. At the same time, comparatively little scholarly attention has been focused on whether the causal mechanisms assumed therein actually generate observed correlations at the micro level. This paper examines exactly these mechanisms – which propose that resource wealth should produce bloated, patronage-laden bureaucratic structures and the under-provision of public goods at the local level. We use subnational data of transfers of national oil wealth to localities in Brazil to examine whether in fact this extraordinary revenue induces comparatively pernicious political behavior on the part of local officials, particularly when controlling for human capital and industrial capacity. Both temporal and cross-sectional variation undergird this analysis, as Brazil has only comparatively recently been the recipient of substantial proceeds from oil extraction, and the distribution of such income is also far from uniform. We join the analysis of transfers with subnational measures of democratic accountability at the sub-national level using electoral data from 1994-2016 to test whether the economic and political resource curse can be observed at the local level in Brazil.

Authors

• Sarah M. Brooks, Ohio State University

• Marcus J. Kurtz, Ohio State University