11:20 - 13:00
P7-S183
Room: 1A.09
Chair/s:
Patrick E Shea
Discussant/s:
Ameetosri Basu
Access to Rural Credit as Non-Programmatic Politics in Municipal Elections in Brazil
P7-S183-1
Presented by: Gabriel Soyer
Gabriel Soyer
University of Georgia
This paper explores how politicians' professional backgrounds influence the distributive politics of rural credit market in Brazil. Rural credit is shaped by directed credit policies, where government-subsidized loans are crucial for agricultural financing. I examine whether electing mayors with agricultural backgrounds (farmer politicians) affects the distribution of rural credit. Using a regression discontinuity design in close elections, I find that municipalities governed by farmer politicians receive more loans but not larger ones. I also explore potential mechanisms with novel identified administrative data with over 90,000 loans, finding that credit recipients who donated to winning farmer politicians are more likely to receive more loans post-election. In-depth interviews with government officials and financial actors suggest local politicians indirectly influence credit allocation through relationships with financial institutions, leading to favoritism and resource allocation based on political alliances.
Keywords: distributive politics; municipal elections; agriculture; credit markets.

Sponsors