Stephanie J. Rickard

London School of Economics

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Spending to Win: Political Institutions, Economic Geography and  Government Subsidies
Governments in some democracies target economic policies, like industrial subsidies, to small groups at the expense of many. Why do some governments redistribute more narrowly than others? Their willingness to selectively target economic benefits, like subsidies to businesses, depends on the way politicians are elected and the geographic distribution of economic activities. Based on interviews with government ministers and bureaucrats, as well as parliamentary records, industry publications, local media coverage, and new quantitative data, Spending to Win: Political Institutions, Economic Geography, and Government Subsidies demonstrates that government policy-making can be explained by the combination of electoral institutions and economic geography. Specifically, it shows how institutions interact with economic geography to influence countries' economic policies and international economic relations. Identical institutions have wide-ranging effects depending on the context in which they operate. As a result, no single institution is a panacea for issues, such as income inequality, international economic conflict, or minority representation.
What people are saying about the book.....
'Spending to Win shows that the interplay of national economic structure and national electoral systems has a powerful impact on economic policy. In it, Stephanie J. Rickard analyzes how the geographical distribution of economic activity interacts with the character of electoral institutions to affect politicians' incentives to cater to special interests. Spending to Win is an original, creative, and compelling contribution to our understanding of the making of economic policy. It is a must read for anyone interested in economic policy, political economy, and electoral institutions.'
- Jeffry Frieden, Stanfield Professor of International Peace, Department of Government, Harvard
'Rickard's book asks an important question in political economy: why do governments sometimes respond to the broad public and other times to special interest groups? Given that this response affects who gets what when, this research focuses on a central issue in politics. The answer given is also novel, combining economic geography and political institutions. Rickard shows that economic policies that most benefit geographically concentrated special interest groups are more common in countries with plurality electoral systems, like the United States. However, providing economic benefits to geographically diffuse groups is the best strategy for parties in proportional representation systems. Her research helps solve the puzzle of why concentrated interest groups sometimes get what they want in politics and sometimes are unable to. The book examines several countries, including France, Austria and Norway, in much greater detail. The research has wider implications for areas like ethnic politics and international relations, making it an invaluable study in comparative political economy.'
- Helen V. Milner, B. C. Forbes Professor of Politics and International Affairs, Princeton University
'A refreshing new perspective on the economic effects of electoral rules, supported by new evidence and a rigorous analysis of the interaction of geography and politics. This book makes a path-breaking contribution to the analysis of modern democracies, and sheds new light on the political and institutional determinants of particularistic economic policies.'
- Guido Tabellini, Intesa Sanpaolo Chair of Political Economics, Università Commerciale Luigi Bocconi
'By inventively operationalizing the previously under appreciated variable of geographic concentration of industries, Rickard greatly advances and refines our understanding of the link between electoral systems and protection. Both her logic and her marshaling of evidence are impeccable.'
- Ronald Rogowski, Distinguished Global Visiting Professor, New York University Abu Dhabi
'Rickard's book provides a clear and compelling theory of subsidies to special interests across the world's wealthy democracies. Its account of how electoral institutions interact with geographic dispersion of industries is at once simple and powerful. The study makes a particularly important contribution to our understanding of economic policies directed to special interests in systems of proportional representation.'
- Miriam Golden, University of California, Los Angeles                                               
Table of Content and Sample Chapters

Chapter 1: Who Gets What and Why? The Politics of Particularistic Economic Policies
Governments' willingness to selectively target economic benefits, like subsidies to businesses, depends on the way politicians are elected and the geographic distribution of economic activities. Electoral institutions interact with economic geography to influence countries' economic policies and international economic relations.

Chapter 2: The Uneven Geographic Dispersion of Economic Activity
One of the most striking features of modern economies is the uneven distribution of economic activity. Activities, such as production and employment, are unevenly distributed across space. In this chapter, I explore the concept of economic geography: what it is, why does it vary, and how might it matter for politics?

Chapter 3: How Institutions and Geography Work Together to Shape Policy
In this chapter, I discuss the mechanisms through which economic geography and electoral institutions work to shape leaders’ policy incentives, notably effective vote maximization and the nature of electoral competition. I also discuss possible alternative mechanisms including government partisanship, factor mobility, party discipline, and electoral competitiveness.

Chapter 4: Explaining Government Spending on Industrial Subsidies
Subsidies for the manufacturing sector constitute a larger share of government expenditures in countries with plurality electoral systems than in countries with proportional systems when manufacturing employment is geographically concentrated. When manufacturing employment is geographically diffuse, governments in proportional systems assign relatively more of their budgets to manufacturing subsidies than governments in plurality systems, holding all else equal.

Chapter 5: The Power of Producers: Successful Demands for State Aid
Two violations of European Union rules on State Aid are examined in this chapter: a program to support Cognac producers in France and a subsidy for Austrian wine makers. The two subsidy programs exhibit different characteristics because of the respective countries’ electoral institutions and economic geography. Countries’ electoral institutions and economic geography influence the likelihood of governments’ compliance with EU state aid rules.

Chapter 6: Why Institutional Differences among Proportional Representation Systems Matter
Among proportional systems, spending on subsidies for diffuse groups is higher in closed list systems, where voters select a party at the ballot box, as compared to open list systems where voters to select individual candidates from a party’s list. The most generous subsidies in PR systems occur in open-list systems with high mean district magnitude and geographically concentrated groups.

Chapter 7: The Policy Effects of Electoral Competitiveness in Closed-List PR
The generosity of government-funded subsidies varies between electoral districts in an archetypal proportional system: Norway. Parties target subsidies to districts where they have relatively more supporters. Qualitative evidence from interviews of government ministers and bureaucrats responsible for the administration of Norway's subsidy programs confirm the importance of electoral politics and economic geography for governments’ spending decisions.

Chapter 8: Conclusion and Implications
My argument suggests a solution to the debate over which democratic institutions make politicians most responsive to special interests, namely economic geography. My argument also adds an important element to neo-institutional theories in political science by demonstrating that it matters not only what voters want from government but also where they are located.

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