Towards the Greater Good? EU Commissioners‘ Nationality and Budget Allocation in the European Union
American Economic Journal: Economic Policy 10.1, 2018 (with Kai Gehring)
We demonstrate that the nationalities of EU Commissioners influence budget allocation decisions in favor of their country of origin. Our focus is on the Commissioners for Agriculture, who are exclusively responsible for a specific fund that accounts for the largest share of the overall EU budget. On average, providing the Commissioner causes a 1 percentage point increase in a country’s share of the overall EU budget, which corresponds to 850 million euros per year. There are no different pretreatment trends and the magnitude of the bias from selection-on-unobservables would have to be implausibly high to account for the estimated coefficient.
- “Funding and Favoritism in the EU”, Chart of the Week, American Economic Association, February 21, 2018
- “Why the Commission Needs Reform”, Euractiv, June 21, 2017
- “Bonus für die Heimat”, Wirtschaftswoche, April 1, 2016, issued as print article only
- “Wenn ein EU-Kommissar 500 Millionen Euro pro Jahr wert ist”, Neue Zürcher Zeitung, March 8, 2016
- “Wie EU-Politiker ihre Heimat systematisch bevorzugen”, Handelszeitung, March 10, 2016
Regional Resources and Demcocratic Secessionism
Journal of Public Economics 181, 2020 (with Kai Gehring)
Although resources have been shown to influence secessionist conflicts in developing countries, their effect in established democracies has largely been neglected. We integrate regional resources and inter-regional transfers in a model of democratic secession, and show that relative regional income correlates positively with secessionist party success in a large panel of regions. To establish causality, our difference-in-differences and triple-differences designs exploit that Scotland and Wales both feature separatist parties, but only an independent Scotland would profit from oil discoveries off its coast. We document an economically and statistically significant positive effect of regional resources and rule out plausible alternative explanations.
- “Aufstieg der Separatisten: Der Einﬂuss regionaler Ressources / Montée des séparatistes : inﬂuence des ressources régionales”, KOF Bulletin, December 4, 2020
- “Separatism on the Rise: the Role of Regional Resources”, VOX – CEPR Policy Portal, February 18, 2020
- “Von Katalonien bis Schottland: Ökonomische Gründe für den Erfolg separatistischer Parteien”, Ökonomenstimme, September 27, 2017
Disastrous Discretion: Ambiguous Decision Situations Foster Political Favoritism
CESifo Working Paper No. 9710 (with Sven Kunze) – current version: April 2022
Revised version conditionally accepted at The Review of Economics and Statistics
New title: “Disastrous Discretion: Political Bias in Relief Allocation Varies Substantially with Disaster Severity“
Allocation decisions are vulnerable to political influence, but it is unclear in which situations politicians use their discretionary power in a partisan manner. We analyze the allocation of presidential disaster declarations in the United States, exploiting the spatiotemporal randomness of hurricane strikes from 1965-2018 along with changes in political alignment. We show that decisions are not biased when disasters are unambiguously strong or weak. Only in ambiguous situations, after medium-intensity hurricanes, do areas governed by presidents‘ co-partisans receive up to twice as many declarations. This political bias explains 10 percent of total relief spending, totaling USD 450 million per year.
Immigration and Nationalism in the Long Run
KOF Working Paper No. 505 (with Valentin Lang) – latest update: August 2022
During recent immigration waves, nationalist parties increased their vote shares in many countries, but the political backlash against immigration in some regions was much stronger than in others. We examine whether past experience with migrant inflows shapes voters‘ reactions to current immigration waves. Our study is based on a natural experiment from Germany, where a short-term and demonstrably arbitrary drawing of occupation zones entailed a discontinuous distribution of forced migrants after World War II. Combining historical migration and election records in a 1949-2021 panel at the municipality level, we exploit these differences in a spatial fuzzy regression discontinuity design. Our results show a substantially weaker nationalist backlash against current immigration in regions that received more forced migrants in the past. Current immigration levels activate and mute this effect of exposure to immigration in the past over a period of at least 70 years.