Election or Disaster Support?

Abstract

In this study, I explore whether the public spending provided in response to a natural disaster is affected by upcoming elections. The theory on retrospective voting argues that politicians are kept responsible by the electorate for the damage caused by a natural catastrophe. At the same time, voters reward government officials when they react promptly by taking actions that limit the negative consequences. Thus, disaster support in the aftermath might not always only be provided to improve the economic situation after a disaster, but also for political purposes. My estimates seem to confirm this idea since roughly 10 per cent of the disaster related public spending provided in an election year is attributed to rent seeking rather than need. It turns out that the existence of these election cycles can partly be explained by cross-country differences. For instance, elections have a stronger effect in countries that are characterised by fewer checks and balances, presidential system and majority elections. One interesting result is that the role of media in electoral manipulation changes when a disaster has happened in the year before.