Shawn A. Cole|
American Economic Journal: Applied Economics|
Fixing Market Failures or Fixing Elections? Agricultural Credit in India
Public|
Printed: Yes
This paper tests for political capture by combining theories of political budget cycles and tactical electional redistribution. The author finds lending increases in India during an election cycle. The closer an election, the greater this increase and cross-targeting of members in the population. This pattern does not occur in private banks or during non-election years. The author concludes that agricultural output is not affected by election-year credit booms, which suggests that bank capturing is costly.
Themes
SOE Effects on Markets
Corporate Governance & Accountability Mechanisms
Region
South Asia (SAR)
Country
India
