2014 Reports

Non-Discriminatory Electoral Rules, Local Public Goods, and Redistribution: Evidence from US Municipalities

Elias, Ferran

The Voting Right Act guaranteed the right to vote for minorities, including the prohibition of any electoral discriminatory practices on the basis of race. This triggered a series of court decisions outlawing discriminatory electoral rules between 1970 and 1990. I study the effects of several court orders that guarantee minority representation on city public budgets, and find that both local public good expenditures (5-7.5%) and city tax collection (5-10%) increased, after the changes towards non-discriminatory electoral rules. I also explore the distributional consequences of non-discriminatory elections and find that the fraction of black public workers and citizens increased after changes in the election system, while those of whites decreased. The growth rates of black house values and rents also increase more. The findings are inconsistent with a negative effect of ethnic heterogeneity in the city council on public goods, and with common-pool theories. I show evidence that the most plausible channel that explains the results is the new legislative bargaining power that black communities gained.