Democratization and Local Bureaucratic Capacity: Evidence from Argentina

• In Event: State Capacity and State Building

Abstract

How does regime change affect state building processes? Crossnational literature on democratization and state building shows that democratization is associated with increases in state capacity, but recent findings point to an opposite relation, whereby elites prefer to deplete the state of its infrastructural capacity in response to democratization due to the threat of greater taxation that comes with it. In this paper, I investigate how investments in bureaucratic capacity change in the aftermath of episodes of regime change. I argue that in contexts of unevenly developed central state infrastructure, local elites’ incentives to invest in bureaucratic capacity will depend on the degree to which the central state is presence in their locality. Concretely, I claim that elites in places with a higher presence of central state infrastructural power face incentives to invest in bureaucracies. To test this hypothesis, I construct a novel fine-grained dataset of municipalities from original archival sources in Argentina between 1900 and 1920. Exploiting different measures of penetration of the central state infrastructure across the territory and employing a difference-in-differences research design, I find that investments in bureaucracy increased following democratization in municipalities with greater presence of the central state. I then discuss potential mechanisms that might drive this effect and argue that both political and economic considerations play a significant role. This paper helps advance the literature on state capacity by exploring its multilevel dynamics in decentralized regimes and its interaction with regime politics.

Author

• Federico Tiberti, Princeton University