Distribution or Diversion? Distribution of Local Public Goods in the Presence of Clientelist Brokers

Abstract

In this article, I argue that, in clientelist regimes, money officially allocated to local public goods will sometimes be diverted to private handouts, and that the extent of diversion will be systematically correlated with electoral outcomes. I show that allocated funds are more likely to translate into local public goods in opposition areas and the incumbent’s ethnic core. Diversion of funds is greatest in areas outside the ethnic core that are nevertheless won by the regime. This is consistent with a model in which brokers tasked with delivering non-coethnic voters to the regime divert funds for this purpose. As a result of extensive diversion in loyal non-coethnic districts, these voters are significantly less likely to see completed local public goods projects than either core voters or those who oppose the regime. This unexpected result suggests that the behavior of local brokers may be responsible for a number of puzzling findings in the distributive politics literature.