Government Transfers and Political Support
Paper No' CEPDP0912:
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Keywords: Conditional cash transfers; redistributive politics, voting, regression discontinuity
JEL Classification: I38; D72
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This Paper is published under the following series:
CEP Discussion Papers
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We estimate the impact of a large anti-poverty program – the Uruguayan PANES – on political support for the
government that implemented it. The program mainly consisted of a monthly cash transfer for a period of
roughly two and half years. Using the discontinuity in program assignment based on a pre-treatment score, we
find that beneficiary households are 21 to 28 percentage points more likely to favor the current government
(relative to the previous government). Impacts on political support are larger among poorer households and for
those near the center of the political spectrum, consistent with the probabilistic voting model in political
economy. Effects persist after the cash transfer program ends. We estimate that the annual cost of increasing
government political support by 1 percentage point is roughly 0.9% of annual government social expenditures.