Poverty, Competition, and Mass Patronage: Evidence from Southern Italy

This article argues that in a context of widespread clientelism and poverty, local public goods provision is a tool for mass patronage. Clientelistic incumbents under threat entice economically vulnerable voters into supporting the regime by creating jobs in the construction sector through infrastructural investments. The theory is tested using data on public works projects funded by the Cassa del Mezzogiorno, a massive place-based policy for the development of Southern Italy introduced after WWII. Empirically, I exploit within-politician shocks in competition induced by the electoral rule of the post-war Italian Senate. The results reveal that public works investments increase when Christian democratic senators are threatened in their own districts by the election of a communist senator, that this effect is particularly strong in areas characterized by low levels of employment, and that this distribution generates electoral returns.