Speaker: Jean-Robert Tyran

Title: Votes (not) for sale

When: Tuesday, 27 January 2026

Where: Applied Micro Seminar, Reinhard Selten Institute, University of Bonn

Abstract:

We document that "cash for votes" (C4V) is pervasive in Tamil Nadu (TN), India, and argue that it undermines democratic accountability through a mechanism of political selection that sustains the practice. Using original survey data from voters and politicians, we show that TN is trapped in an equilibrium in which voters expect payments from politicians perceived as corrupt, parties distribute cash to mobilize and persuade, and politicians correctly anticipate that voters systematically respond to such payments despite ballot secrecy. We develop a framework in which parties face a prisoner’s dilemma that favors candidates capable of raising large sums of money, thereby entrenching corruption. Leveraging a natural experiment created by an arbitrarily drawn border dividing a culturally homogeneous region, we show that neighboring Kerala has coordinated on a more efficient equilibrium without C4V. In Kerala, voters hold low priors about candidate corruption, so offering C4V signals corruption. Consequently, parties refrain from C4V, and less corrupt candidates self-select into politics. Our spatial discontinuity design highlights beliefs—rather than reciprocity alone—as the key mechanism sustaining C4V.