An influential group of political economists posits a negative relationship between the relative size of non-tax revenues in public balance sheets and the level of democracy in a given county. While empirical evidence for this proposition is largely based on cross-national studies, scholars have largely neglected subnational contexts as important domains of research. Addressing this disjuncture, the author studies the electoral impact of two important subnational non-tax revenues - natural resource royalties and central-government fiscal transfers - at the municipal level in Colombia. Employing a propensity score matching approach to attenuate problems of omitted variable bias, a quantitative analysis of Colombia's 1119 municipalities shows that higher levels of fiscal transfers and petroleum royalties had no discernible impact on the average level of competitiveness in the 2007 and 2011 municipal elections. If anything, there seems to be a positive impact of non-tax revenues on electoral contestation. Supported by qualitative evidence from theoretical outliers in the set of observations, the results suggest that non-tax revenue promotes electoral competition by raising the stakes of attaining political office. At the same time, abundance in fiscal transfers and resource royalties may undermine democratic governance through means that are not reflected in electoral margins.
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Political Science
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Rutgers University Electronic Theses and Dissertations
Rutgers University. Graduate School - New Brunswick
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