1 The Political Economy Origins and Consequences of Legislative Malapportionment Miriam Bruhn (The WorldBank) Francisco Gallego (PUC-Chile) Massimiliano Onorato (Bocconi) NASMES 2009-BU

Motivation I Why do we observe malapportionment (ie. deviations of the “one citizen, one vote” principle, Dahl, 1971 and 1989)? –Even democratic countries have non-trivial deviations. Consider lower chamber malapportionment (simple index): Argentina: 0.14 Chile: 0.15 Bolivia: 0.17 Ecuador 0.20 World average (without LA): 0.06 The US Supreme Court’s decision of ordering legislative redistricting in 1964 is based on the consideration that legislative malapportionment is not compatible with fair democratic procedures

3 Motivation II Why do we observe its presence and persistence in many democratic regimes? Can we think of any political/economical rationale behind it? Does representation matter? Does apportionment of legislative seats also determine the distribution of political power? Does representational bias cause policy bias? Does malapportionment have relevant political and economic consequences?

4 Motivation III Relevance of a “cluster” of institutions to explain patterns of economic performance (Acemoglu et. al., 2001 and 2002, Rodrick et al., 2004), but still more work to be done to understand the effect of specific institutional features on economic and political outcomes (Acemoglu and Johnson, 2005) Persson and Tabellini (2006) point out that democracy is still “too blunt a concept”. Looking at legislative malapportionment is a way of substantiating the concept of democracy But, unlike other “grey areas” of democratic regimes (patronage, corruption), malapportionment is clearly defined and measurable

5 Outline Definition and measurement of (legislative) malapportionment Some anecdotal evidence Motivating theory Empirical results –Panel data of countries Legislative malapportionment and transitions to democracy –Panel data of regions of countries Legislative malapportionment and political and economic outcomes Conclusions

6 What is legislative malapportionment? Malapportionment occurs “when geographical units have shares of legislative seats that are not equal to their share of population” (Monroe, 1994). Malapportionment as a formal and often deliberate “pathology of electoral systems” (Taagepera and Shugart, 1989; Snyder and Samuels, 2004) in democratic regimes. Samuels and Snyder (2001) and Snyder and Samuels (2004) provide data based on the Loosemore–Hanby index of disproportionality for electoral systems

7 How to measure country – wide legislative malapportionment? Samuel-Snyder index: Country j’ s level of legislative malapportionment is given by: Intuition: –MAL=0 represents a fully apportioned chamber where no citizen’s vote weighs more than another’s. –MAL=0.3 means that 30% of seats are allocated to districts that would not receive these seats if there were no malapportionment –MAL=1: limit case where all seats are allocated to one district with only one voter

8 How to measure which districts are over/under – represented? Following Ansolabehere, Gerber, and Snyder (2002), we compute the Relative Representation Index as: Intuition: RRI equal 1  one person, one vote rule > 1  district i over – represented < 1  district i under - represented

9 Anecdotal Evidence Transitions to democracy and malapportionment: –“Spontaneous” malapportionment can arise over time because of dynamics of migration, of different patterns of population growth and industrialization but… –…many of the most malapportioned countries are newly established or consolidating democracies with constitutions with explicit guarantees of the equality of each citizen’s vote –but…

10 CountryMalapportionm. (lower chamber) Transition to democracy Tanzania S. Korea Ecuador Kenya Ghana Zambia Iceland Bolivia Malawi Chile Sources: Samuels and Snyder, 2001 and POLITY IV Database

11 Malapportionment and Transition to Democracy in Latin America Sources: Snyder and Samuels, 2004 and POLITY IV Database

12 Strategic Malapportionment and Transition to Democracy in Latin America Historical evidence from Latin America of “strategic” malapportionment for political purposes: –Argentina: the military junta ( ) increased malapportionment just before transition to democracy, 1983, to further over-represent conservative provinces –Brazil: in just prior to reintroduction of democratic elections– the military gave additional overrepresentation to conservative regions –Chile: Pinochet ( ) before leaving his office redesigned the electoral system to over-represent conservative areas

13 Malapportionment and (Skewed) Legislative Representation in Latin America (Snyder and Samuels, 2004) Argentina: provinces that account for 31% of population control 44% of seats in the Chamber of Deputies Brazil: regions that hold 42% of the population control 51% of lower chamber seats Chile: districts with 35% of the population control 50% of lower chamber seats

14 Motivating Theory I Previous literature: –Elite and transition to democracy: Acemoglu and Robinson, 2006 and 2008 –Political regimes and policy outcomes: Mulligan, Gil and Sala – i – Martin, 2004; Persson and Tabellini, 2006 and 2007 –Endogenous choice of political institutions: Aghion, Alesina and Trebbi, 2004 and 2008; Ticchi and Vindigni, 2002

15 Motivating Theory II Basic framework to analyze transition to democracy and democratic consolidation: Acemoglu and Robinson, 2006  main insight: in equilibrium democratization is a “credible commitment” to pro – citizens policies (such as redistribution) The elite (endowed with political power in dictatorship) have a stronger incentive to capture democracy, the higher their political and economic stakes are.

16 Motivating Theory III We can think of malapportionment as a device available to the elite to keep de jure political power in democracies….. and as a substitute for using de facto power (lobbying, buying voters) to capture democracy, which involves “collective action problems”  democracies can emerge, persist and consolidate but in a captured form The elite endowed with larger political influence than their number would deserve and still able to impose their preferred policies (Acemoglu and Robinson, 2008 and Acemoglu, Ticchi and Vindigni, 2006)  coups and other reversions back to dictatorship are less likely

17 Motivating Theory IV Possible channels through which legislative malapportionment can affect economic development: –can reduce the degree of political competition (à la Besley, Persson, Sturm, 2005) –can produce a suboptimal allocation or misallocation of public resources, by diverting funds to regions or agents with more political power We should observe malapportioned regions to be more pro-former dictatorships regimes (former political elites)

18 Empirical Results Cross – country panel data regressions for 11 Latin American countries. Time period: Within country (state level regressions) for q5 Latin American countries. Time period: data for a cross-section around

19 Panel data regressions: Democratic Consolidation and Legislative Malapportionment Estimating equation (Acemoglu, Johnson, Robinson, Yared, 2005, 2007): where Robust standard errors clustered at country level

20 Legislative malapportionment and democratic consolidation in 11 Latin American countries, 1870 – 2000 The OLS regression in Column (1) includes country and time dummies and has the error term clustered at the country level. Robust standard errors in parenthesis in Column (2). Significance levels: * 10% ** 5% ***1%

21 Legislative malapportionment and democratic consolidation in 11 Latin American countries, 1870 – 2000 The OLS regression in Column (1) includes country and time dummies and has the error term clustered at the country level. Robust standard errors in parenthesis in Column (2). Significance levels: * 10% ** 5% ***1% Economic significance: standardized effects 1 s.d. increase in mal implies: increase of bw and 0.14 s.d in on impact Increase of bw and 0.28 in the long run

22 Within-country regressions: Relative representation and outcomes The model (Acemoglu, Johnson, Robinson, Yared, 2005, 2007): …where y is some outcome of interest, i is state and j is country Robust standard errors clustered at country level

23 Legislative malapportionment and partisan outcomes The OLS regression includes country dummies. Robust standard errors in parenthesis. Significance levels: * 10% ** 5% ***1% Dependent variable: Share of votes for parties close to pre- democracy regimes (1)(2) Log(Seats/Pop)0.054**0.085** (0.025)(0.036) Country dummiesYES ControlsNOYES Observations118 R-squared

24 Legislative malapportionment and partisan outcomes The OLS regression includes country dummies. Robust standard errors in parenthesis. Significance levels: * 10% ** 5% ***1% Dependent variable: Share of votes for parties close to pre- democracy regimes (1)(2) Log(Seats/Pop)0.054**0.085** (0.025)(0.036) Country dummiesYES ControlsNOYES Observations118 R-squared Economic significance: standardized effects 1 s.d. increase in mal implies: increase of bw and 0.38 s.d in voting share

25 Legislative malapportionment and political competition The OLS regression includes country dummies. Robust standard errors in parenthesis. Significance levels: * 10% ** 5% ***1%

26 Legislative malapportionment and political competition The OLS regression includes country dummies. Robust standard errors in parenthesis. Significance levels: * 10% ** 5% ***1% Economic significance: standardized effects 1 s.d. increase in mal implies: increase of bw and 0.50 s.d in concentration in former elite parties

27 Over-represented electoral districts get more per capita transfers from the central government OLS regressions with country fixed effects and robust standard errors in parenthesis. Significance levels: * 10% ** 5% ***1%. Regressions include the following region level controls: landlocked dummy, average yearly temperature and temperature squared, total yearly rainfall and rainfall squared, altitude and altitude squared (for sources see Bruhn & Gallego, 2009)

28 Over-represented electoral districts get more per capita transfers from the central government OLS regressions with country fixed effects and robust standard errors in parenthesis. Significance levels: * 10% ** 5% ***1%. Regressions include the following region level controls: landlocked dummy, average yearly temperature and temperature squared, total yearly rainfall and rainfall squared, altitude and altitude squared (for sources see Bruhn & Gallego, 2009) Economic significance: standardized effects 1 s.d. increase in mal implies: increase of bw and 0.07 s.d in transfers

29 Conclusions Malapportionment helps to give more content to the idea of democracy Results consistent with a simple political-economy rationale: –Malapportionment helps sustaining democratic consolidation –…is related to over-representation of elites, more political concentration to pro-elite parties, and more public spending in these regions  Manipulation of democracy in favor of political elites Additional research: related to lower economic development (quite robust)