The Fiscal Consequences of Electoral Institutions

Abstract

JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org. AbstractThere are more than 500,000 elected local government officials in the United States. The most electorally dense county has more than 20 times the average number of elected officials per capita. This paper offers the first systematic investigation of the link between electoral density and fiscal outcomes. Electoral density presents a tradeoff between accountability and monitoring costs. Increasing the number of specialized elected offices promotes issue unbundling, reducing slack between citizen preferences and government policy; but the costs of monitoring a larger number of officials may offset these benefits, producing greater latitude for politicians to pursue their own goals at the expense of citizen interests. We predict diminishing returns to electoral density and a U-shaped relationship between the number of elected local officials and government fidelity to citizen preferences. We find that public sector size decreases with electoral density up to a point, beyond which budgets grow as more officials are added.