Financial disclosure and political selection: Evidence from India

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Event Type: 
Seminar Series
Date and Time: 
Monday, November 5, 2018
2:00 pm – 3:30 pm
Ray Fisman
Boston University

We study the effect of financial disclosure on the selection of politicians, exploiting the staggering of Indian state assembly elections to identify the effect of disclosure laws. We document a 13 percentage point increase in exit of incumbents post-disclosure, indicating that disclosure has a large effect on politician self-selection.  This selection coincides with higher probability of winning for remaining incumbents, relative to a set of counterfactual candidates, suggesting that voters interpreted the selection as positive. These effects are concentrated in states with elections occurring post-demonetization, reinforcing the interpretation of our findings as stemming from concerns of wealth disclosure.