Hostname: page-component-848d4c4894-ttngx Total loading time: 0 Render date: 2024-05-09T19:42:18.831Z Has data issue: false hasContentIssue false
  • English
  • Français

Intergovernmental Politics of Fiscal Balance in a Federal Democracy: The Experience of Brazil, 1996–2005

Published online by Cambridge University Press:  02 January 2018

Ozge Kemahlioglu
Ozge Kemahlioglu*
Affiliation:
Sabanci University. ozgekemah@sabanciuniv.edu
Get access Rights & Permissions [Opens in a new window]

Abstract

Irresponsible fiscal behavior by subnational units is a concern for federal or decentralized systems, especially in the developing world. States' expenditures in Brazil have been no different. Still, spending varies considerably among the Brazilian states, even after controlling for their financial resources. This article provides a political explanation for the variation in current spending, focusing on intergovernmental political relationships. It argues that credit claiming for pork distributed in a state plays a crucial role and that governors elevate state spending in order to make up for their loss in political credit from the pork distributed by the president. Analyzing data from the period 1996–2005, it finds that expenditures decrease as the relative number of federal deputies from the state governor's party increases compared to the number of deputies from the president's governing coalition when the national agenda encourages federal pork distribution in the states.

Type
Research Article
Information
Latin American Politics and Society , Volume 57 , Issue 1 , Spring 2015 , pp. 51 - 74
Copyright
Copyright © University of Miami 2015

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Abers, Rebecca Neaera. 2000. Inventing Local Democracy: Grassroots Politics in Brazil. Boulder: Lynne Rienner.Google Scholar
Abrucio, Fernando Luiz. 1998. Os barões da federação, os governadores e a redemacratização brasileira. São Paulo: Editora Hucitec/Departemento de Ciencia Politica, Universidad de São Paulo.Google Scholar
Afonso, J. R., and Ramundo, J. C.. 1996. Federalismo fiscal no Brasil: breves notas. Seminário sobre Gastão da Despesa Pública. Ministério da Fazenda, Brasília, March. Cited in Ter-Minassian 1997.Google Scholar
Alesina, Alberto, and Bayoumi, Tamin. 1996. The Costs and Benefits of Fiscal Rules: Evidence from the U.S. States. NBER Working Paper 5614. Cambridge, MA: National Bureau of Economic Research.Google Scholar
Alm, James, and Evers, Mark. 1991. The Item Veto and State Government Expenditures. Public Choice 68: 1–15.Google Scholar
Alston, Lee J., and Mueller, Bernardo. 2006. Pork for Policy: Executive and Legislative Exchange in Brazil. Journal of Law, Economics, and Organization 22, 1: 87–114.CrossRefGoogle Scholar
Alston, Lee, Melo, Marcus, Mueller, Bernardo, and Pereira, Carlos. 2008. The Choices Governors Make: the Roles of Checks and Balances and Political Competition. Unpublished mss.Google Scholar
Alt, James E., and Lowry, Robert C.. 1994. Divided Government, Fiscal Institutions, and Budget Deficits: Evidence from the States. American Political Science Review 88, 4: 811–28.Google Scholar
Alt, James E., and Lowry, Robert C.. 2000. A Dynamic Model of State Budget Outcomes under Divided Partisan Government. Journal of Politics 62, 4 (November): 1035–69.Google Scholar
Ames, Barry. 1995. Electoral Strategy under Open-List Proportional Representation. American Journal of Political Science 39, 2: 406–33.Google Scholar
Ames, Barry. 2001. The Deadlock of Democracy in Brazil. Ann Arbor: University of Michigan Press.Google Scholar
Anderson, Sally, and Kemahlioglu, Ozge. 2008. Economic Outcomes and Subnational Election Results in the Case of Argentina. Paper prepared for the International Studies Association Conference, San Francisco, March.Google Scholar
Arena, Marco, and Revilla, Julio E.. 2009. Pro-cyclical Fiscal Policy in Brazil: Evidence from the States. World Bank Policy Research Working Paper 5144. Washington, DC: World Bank.Google Scholar
Arretche, Marta. 2007. The Veto Power of Subnational Governments in Brazil: Political Institutions and Parliamentary Behavior in the Post-1988 Period. Brazilian Political Science Review 1, 2: 40–73.Google Scholar
Bevilaqua, Afonso S. 2002. State Government Bailouts in Brazil. Working Paper R–441. Washington, DC: Inter-American Development Bank Latin American Research Network.Google Scholar
Brambor, Thomas, Clark, Williams R. and Golder, Matt. 2006. Understanding Interaction Models: Improving Empirical Analyses. Political Analysis 14: 63–82.CrossRefGoogle Scholar
Brender, Adi. 2003. The Effect of Fiscal Performance on Local Government Election Results in Israel, 1989–1998. Journal of Public Economics 87: 2187–2205.CrossRefGoogle Scholar
Carey, John M., and Yannitell Reinhardt, Gina. 2004. State-Level Institutional Effects on Legislative Coalition Unity in Brazil. Legislative Studies Quarterly 29, 1 (February): 23–47.Google Scholar
Chamber of Deputies. n.d. Data on legislators' party affiliations. http://www.camara.gov.br/Internet/votacao Google Scholar
Cheibub, José, Figueiredo, Argelina, and Limongi, Fernando. 2009. Political Parties and Governors as Determinants of Legislative Behavior in Brazil's Chamber of Deputies, 1988– 2006. Latin American Politics and Society 5, 1 (Spring): 1–30.Google Scholar
Daughters, Robert, and Harper, Leslie. 2007. Fiscal and Political Decentralization Reforms. In The State of State Reform in Latin America, ed. Lora, Eduardo. Washington, DC: World Bank/Stanford University Press. 213–61.Google Scholar
De Mello, Luiz R. Jr. 2000. Fiscal Decentralization and Intergovernmental Fiscal Relations: a Cross-Country Analysis. World Development 28, 2: 365–80.Google Scholar
Desposato, Scott W. 2004. The Impact of Federalism on National Party Cohesion in Brazil. Legislative Studies Quarterly 29, 2: 259–85.Google Scholar
Desposato, Scott W. 2006. Parties for Rent? Careerism, Ideology, and Party Switching in Brazil's Chamber of Deputies. American Journal of Political Science 50, 1: 62–80.Google Scholar
Dilliger, William, and Webb, Steven B.. 1999. Fiscal Management in Federal Democracies: Argentina, Brazil. Policy Research Working Paper 2121. Washington, DC: World Bank.Google Scholar
Figueiredo, Argelina Cheibub. 2007. Government Coalitions in Brazilian Democracy. Brazilian Political Science Review 1, 2: 182–216.CrossRefGoogle Scholar
Figueiredo, Argelina Cheibub, and Limongi, Fernando. 2000. Presidential Power, Legislative Organization, and Party Behavior in Brazil. Comparative Politics 32, 2: 151–70.Google Scholar
Geddes, Barbara. 1994. Politician's Dilemma: Building State Capacity in Latin America. Berkeley: University of California Press.Google Scholar
Gélineau, François, and Remmer, Karen. 2005. Political Decentralization and Electoral Accountability: the Argentine Experience, 1983–2001. British Journal of Political Science 36: 133–57.Google Scholar
Greggianin, Eugenio. n.d. Processo de aprecıação orçamentárıa no Congresso Nacıonal. Subsídios para a reforma orçamentária. Brasília: Câmara dos Deputados. http://www2.camara.leg.br/atividade-legislativa/orcamentobrasil/orcamentouniao/estudos/artigos/2005/Artigo280.pdf. Accessed April 15, 2014.Google Scholar
Hagopian, Frances, Gervasoni, Carlos, and Andrés Moraes, Juan. 2009. From Patronage to Program: the Emergence of Party-Oriented Legislators in Brazil. Comparative Political Studies 42: 360–91.Google Scholar
Hunter, Wendy. 2007. The Normalization of an Anomaly: the Workers' Party in Brazil. World Politics 59: 440–75.Google Scholar
Instituto Brasileiro de Geografia e Estatistica (IBGE). n.d. Gdp and population data. Website. www.ibge.gov.br Google Scholar
International Monetary Fund (IMF). n.d. Imf World Economic Outlook Deflator. http://www.imf.org/external/pubs/ft/weo/2014/02/weodata/index.aspx Google Scholar
Jones, Mark, Meloni, Osvaldo, and Tomassi, Mariano. 2012. Voters as Fiscal Liberals: Incentives and Accountability in Federal Systems. Economics and Politics 24, 2: 135–56.Google Scholar
Jones, Mark P., Sanguinetti, Pablo, and Tomassi, Mariano. 2000. Politics, Institutions, and Fiscal Performance in a Federal System: an Analysis of the Argentine Provinces. Journal of Development Economics 61: 305–33.Google Scholar
Keck, Margaret E. 1992. The Workers' Party and Democratization in Brazil. New Haven: Yale University Press.Google Scholar
Khemani, Stuti. 2001. Decentralization and Accountability: Are Voters More Vigilant in Local than in National Elections? Policy Research Working Paper 2557. Washington, DC: World Bank.Google Scholar
Khemani, Stuti. 2002. Federal Politics and Budget Deficits: Evidence from the States of India. Policy Research Working Paper 2915. Washington, DC: World Bank.Google Scholar
Khemani, Stuti. 2007. Party Politics and Fiscal Discipline in a Federation: Evidence from the States of India. Comparative Political Studies 40: 691–712.Google Scholar
Kneebone, Ronald D., and McKenzie, Kenneth J.. 2001. Electoral and Partisan Cycles in Fiscal Policy: an Examination of Canadian Provinces. International Tax and Public Finance 8: 753–74.Google Scholar
Leoni, Eduardo, and Rennó, Lucio. 2006. Reelection and Fiscal Responsibility Law: Reducing Populist Pressures in Brazil. Unpublished mss.Google Scholar
Lima, Silvânia. 2013. Inaugurado primeiro prédio do Parque Tecnológico Samambaia. Universidad Federal de Goiás, December 11. https://www.ufg.br/pages/64972-inaugurado-primeiro-predio-do-parque-tecnologico-samambaia. Accessed April 15, 2014.Google Scholar
Litschig, Stephan, and Morrison, Kevin. 2010. Local Government Spending and Incumbent Party Re-election: Quasi-Experimental Evidence from Brazil. Unpublished mss.Google Scholar
Lledo, Victor. 2003. Electoral Systems, Legislative Fragmentation, and Public Spending: a Comparative Analysis of Brazilian States. Paper prepared for the Latin American Studies Association 24th International Congress, Dallas, March 27–29.Google Scholar
Lodola, Germán. 2010. The Politics of Subnational Coalition Building: Gubernatorial Redistributive Strategies in Argentina and Brazil. Ph.D. diss., University of Pittsburgh.Google Scholar
Lowry, Robert C., Alt, James E., and Ferree, Karen E.. 1998. Fiscal Policy Outcomes and Electoral Accountability in American States. American Political Science Review 92, 4: 759–74.Google Scholar
Lyne, Mona M. 2008. The Voter's Dilemma and Democratic Accountability: Latin America and Beyond. University Park: Pennsylvania State University Press.Google Scholar
Machado, Aline. 2009. Minimum Winning Coalitions under Presidentialism: Reality or Fiction? the Case of Brazil. Latin American Politics and Society 51, 3 (Fall): 87–110.Google Scholar
Magaloni, Beatriz, Díaz-Cayeros, Alberto, and Estevez, Federico. 2007. Clientelism and Portfolio Diversification: A Model of Electoral Investment with Applications to Mexico. In Patrons, Clients and Policies: Patterns of Democratic Accountability and Political Competition, ed. Kitschelt, Herbert and Wilkinson, Steven I.. Cambridge: Cambridge University Press. 182–205.Google Scholar
Mainwaring, Scott P. 1999. Rethinking Party Systems in the Third Wave of Democratization: The Case of Brazil. Stanford: Stanford University Press.Google Scholar
Mainwaring, Scott, Meneguello, Rachel, and Power, Timothy. 1999. Conservative Parties, Democracy, and Economic Reform in Contemporary Brazil. Working Paper 264. Notre Dame: Kellogg Institute.Google Scholar
Merrifield, John. 2000. State Government Expenditure Determinants and Tax Revenue Determinants Revisited. Public Choice 102: 25–50.Google Scholar
Ministério da Fazenda (Ministry of Finance). Various years. Data on state-level current spending and revenue. www.fazenda.gov.br Google Scholar
Montero, Alfred P. 2000. Devolving Democracy? Political Decentralization and the New Brazilian Federalism. In Democratic Brazil: Actors, Institutions, and Processes, ed. Kingstone, Peter R. and Power, Timothy J.. Pittsburgh: University of Pittsburgh Press. 58–77.Google Scholar
Montero, Alfred P. 2001. Decentralizing Democracy: Spain and Brazil in Comparative Perspective. Comparative Politics 33, 2 (January): 149–69.Google Scholar
Morgenstern, Scott. 2004. Patterns of Legislative Politics: Roll-Call Voting in Latin America and the United States. New York: Cambridge University Press.Google Scholar
Nicolau, Jairo. n.d. Electoral results. Website. http://jaironicolau.iuperj.br/banco2004.htm Google Scholar
Peltzman, Sam. 1992. Voters as Fiscal Conservatives. Quarterly Journal of Economics 107, 2: 327–61.Google Scholar
Pereira, Carlos, and Mueller, Bernardo. 2004. The Cost of Governing: Strategic Behavior of the President and Legislator in Brazil's Budgetary Process. Comparative Political Studies 37, 7: 781–815.Google Scholar
Pereira, Carlos, and Rennó, Lucio. 2003. Successful Re-election Strategies in Brazil: the Electoral Impact of Distinct Institutional Incentives. Electoral Studies 22: 425–48.Google Scholar
Poterba, James M. 1994. State Responses to Fiscal Crisis: the Effects of Budgetary Institutions and Politics. Journal of Political Economy 102, 4 (August): 799–821.Google Scholar
Power, Timothy J. 2010. Optimism, Pessimism, and Coalitional Presidentialism: Debating the Institutional Design of Brazilian Democracy. Bulletin of Latin American Research 29, 1: 18–33.CrossRefGoogle Scholar
Power, Timothy J., and Zucco, Cesar Jr. 2009. Estimating Ideology of Brazilian Legislative Parties, 1990–2005: a Research Communication. Latin American Research Review 44, 1: 218–46.Google Scholar
Raile, Eric D., Pereira, Carlos, and Power, Timothy J.. 2011. The Executive Toolbox: Building Legislative Support in a Multiparty Presidential Regime. Political Research Quarterly 64, 2: 323–34.Google Scholar
Remmer, Karen, and Wibbels, Erik. 2000. The Subnational Politics of Economic Adjustment: Provincial Politics and Fiscal Performance in Argentina. Comparative Political Studies 33, 4 (May): 419–51.CrossRefGoogle Scholar
Remmer, Karen, and Gélineau, François. 2003. Subnational Electoral Choice: Economic Referendum and Voting in Argentina, 1983–1999. Comparative Political Studies 36, 7: 801–21.Google Scholar
Rodden, Jonathan. 2003. Federalism and Bailouts in Brazil. In Fiscal Decentralization and the Challenge of Hard Budget Constraints, ed. Rodden, , Eskeland, Gunnar S., and Litvack, Jennie. Cambridge: MIT Press. 213–49.Google Scholar
Rodden, Jonathan, and Wibbels, Erik. 2005. Retrospective Voting, Coattails, and Accountability in Regional Elections. Paper presented at the American Political Science Association meeting, Washington, DC, September.Google Scholar
Rogers, Diane Lim, and Rogers, John H.. 2000. Political Competition and State Government Size: Do Tighter Elections Produce Looser Budgets? Public Choice 105: 1–21.Google Scholar
Roubini, Nouriel, and Sachs, Jeffrey. 1989. Government Spending and Budget Deficits in the Industrial Countries. Economic Policy 4, 8: 100–132.Google Scholar
Sakurai, Sergio, and Menezes-Filho, Naercio. 2008. Fiscal Policy and Reelection in Brazilian Municipalities. Public Choice 137: 301–14.CrossRefGoogle Scholar
Samuels, David. 2000a. The Gubernatorial Coattails Effect: Federalism and Congressional Elections in Brazil Journal of Politics 62, 1: 240–53.Google Scholar
Samuels, David. 2000b. Concurrent Elections, Discordant Results: Presidentialism, Federalism, and Governance in Brazil. Comparative Politics 33, 1: 1–20.Google Scholar
Samuels, David. 2002. Pork Barreling Is Not Credit Claiming or Advertising: Campaign Finance and the Sources of the Personal Vote in Brazil. Journal of Politics 64, 3: 845–63.Google Scholar
Samuels, David. 2003. Ambition, Federalism, and Legislative Politics in Brazil. New York: Cambridge University Press.Google Scholar
Samuels, David. 2004. From Socialism to Social Democracy: Party Organization and the Transformation of the Workers' Party in Brazil. Comparative Political Studies 37, 9: 999–1024.Google Scholar
Samuels, David. 2009. Mass Partisanship in Brazil. In Latin American Democratic Transformations: Institutions, Actors, and Processes, ed. Smith, William C.. Hoboken: John Wiley & Sons.Google Scholar
Samuels, David, and Zucco, Cesar Jr. 2014. The Power of Partisanship in Brazil: Evidence from Survey Experiments. American Journal of Political Science 58, 1 (January): 212–25.Google Scholar
Samuels, David, and Luiz Abrucio, Fernando. 2000. Federalism and Democratic Transitions: the “New” Politics of the Governors in Brazil. Publius: Journal of Federalism 30, 2: 43–61.Google Scholar
Santos, Fabiano, and Batista, Christiane. 2010. Instituciones políticas y políticas públicas en la federación brasileña. Latin American Research Review 45, 3: 187–211.Google Scholar
Seitz, Helmut. 2000. Fiscal Policy, Deficits and Politics of Subnational Governments: the Case of the German Laender. Public Choice 102: 183–218.Google Scholar
Souza, Celina. 1996. Redemocratization and Decentralization in Brazil: the Strength of the Member States. Development and Change 27: 529–55.Google Scholar
Souza, Celina. 1999. Federalism and Regional Interest Intermediation in Brazilian Public Policies. Public Administration and Development 19: 263–79.Google Scholar
Ter-Minassian, Teresa. 1997. Fiscal Federalism in Theory and Practice. Washington, DC: International Monetary Fund.Google Scholar
World Bank World Development Indicators. n.d. http://data.worldbank.org/products/wdi Google Scholar
Zucco, Cesar Jr. 2009. Ideology or What? Legislative Behavior in Multiparty Presidential Settings. Journal of Politics 71, 3: 1076–92.Google Scholar