Political Competition and the Diffusion of Policy Innovations in Local Government: the Case of Participatory Budgeting in Brazil

By Paolo Spada (Yale University – September 2010):


“The diffusion of participatory budgeting does not exibit over time the S-shape typical of many technocratic policy innovations. I propose two mechanisms that explain the unusual diffusion of participatory budgeting in the Brazilian case. The first posits that participatory budgeting is adopted by mayors looking to expand their political support. The second mechanism claims that the Workers’ Party has branded participatory budgeting as a proprietary policy. This implies an additional adoption cost for cities not controlled by the Workers’ Party. Using a panel dataset with more than 400 cities covering the period between 1996 and 2008, the statistical analysis shows that an increase in political competition (measured as the share of the largest opposition party), irrespective of which party wins, leads to a higher probability of adoption. Additionally, among the cities controlled by the Workers’ Party, the mayor’s vote share is negatively correlated with adoption. Finally, in large cities not controlled by the Workers’ Party, the Workers’ Party seat share in the city chamber is negatively correlated with adoption. The latter effect might be a sign of the existence of branding, or might simply reflect that the Workers’ Party actively opposes the implementation of participatory budgeting when in the opposition.”

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