IZA DP No. 2836: Exposing Corrupt Politicians: The Effects of Brazil’s Publicly Released Audits on Electoral Outcomes
published in: Quarterly Journal of Economics, 2008, 123 (2), 703-745
This paper examines whether access to information enhances political accountability. Based upon the results of Brazil’s recent anti-corruption program that randomly audits municipal expenditures of federally-transferred funds, it estimates the effects of the disclosure of local government corruption practices upon the re-election success of incumbent mayors. Comparing municipalities audited before and after the elections, we show that the audit policy reduced the incumbent’s likelihood of re-election by approximately 20 percent, and was more pronounced in municipalities with radio stations. These findings highlight the value of information and the role of the media in reducing informational asymmetries in the political process.