Interest in the study of clientelism has reawakened in recent years. While the sociological and anthropological frameworks developed in the 1960s and 1970s still provide important insights into the logic of patron–client exchanges, a reckoning with the underlying political process that makes those forms of political linkage so prevalent is in order. Clientelism was then viewed as a phenomenon typical of underdeveloped political systems, usually at early phases of institutionalization, often under authoritarian or colonial regimes. Indeed, the literature suggested that clientelism was the most characteristic form of political exchange occurring in backward agrarian societies. Presumably, as societies became more developed, social structures more differentiated, and political systems more institutionalized, clientelism was bound to disappear. Yet it has not. Throughout most of the developing world and even in many parts of the developed one, clientelism remains a political and electoral fact of life.

The defining trait of clientelism is that it involves direct exchanges between patrons and clients in which political support is traded for excludable benefits and services. Under what conditions do politicians attempt to buy votes through the provision of particularistic, excludable private goods, rather than through universalistic, non-excludable public goods? To answer this question, this chapter develops a portfolio theory of electoral investment and demonstrates its usefulness in the context of the erosion of hegemonic party rule in Mexico.

Our theory proposes that the relative importance of clientelism vis-à-vis public goods provision depends upon the extent of poverty, political competition, and the level of electoral risk.