The "hidden" power of money: how campaign contributions to legislators buy influence through executive action
P14-1
Presented by: Nelson Ruiz
Recent evidence shows that elected candidates to executive offices reciprocate their donors via public contracts, but the benefits received by legislators' donors has not been found. We argue that the quid pro quo between legislators and their donors is difficult to find because the reward for the contributions comes indirectly through actions taken by the executive and that the capacity of legislators to direct contracts to donors is conditional on their leverage with the executive. In this paper, we test how the bargaining power of legislators with the executive can condition rewards for legislators' donors. We do this by using a novel dataset that links individual donors of local councillors to contracts assigned by the municipal governments in Colombia. In order to identify how bargaining power with the executive determine donors' rewards, we use a double regression discontinuity design; if legislators are barely elected in the party of the executive, and if the party of the executive barely obtains a majority in the council. We test whether executives assign more contracts for legislators' donors when the legislators are in the majority party, or alternatively, fewer contracts when in the minority to reward opposition support. This paper aims to open the black box on how inter legislative-executive bargaining can moderate the influence of campaign money in politics.