The influence of political cycles in public investment in infrastructure: a study in the Brazilian states from 2003 to 2014
Keywords:ciclos políticos, investimentos públicos, estados brasileiros
This study aims to evaluate whether political cycles, considering the governments’ ideological bias, have significant impact on the decision-making regarding the allocation of public investments in infrastructure in the States of Brazil. The study used information of Brazilian States from the period between 2003 and 2014 in order to cover three political cycles. The method used was panel fixed effects regression which allows to identify characteristics of the States that are not clear and constant in time. The results show there is influence of the electoral cycle, if considering that ideological differences are connected to electoral cycles. Left-wing and center parties tend to invest more in infrastructure in pre-election periods when compared to right-wing parties. This result also contributes to the literature because it shows that cycles can be more influential depending on the party that is governing. A counter-intuitive result worthwhile mentioning is the negative impact of expenditures in infrastructure when the Governor belongs to the same political party as the President. For this variable, a positive impact was expected.