Kosher pork

Drazen, Allan and Ilzetzki, Ethan (2023) Kosher pork. Journal of Public Economics, 227. ISSN 0047-2727

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Abstract

There are two common views of pork barrel spending. One is that pork barrel spending benefits special interests at the expense of social welfare, hence antithetical to responsible policy making, especially in times of crisis. An alternative is that pork “greases the legislative wheels” making possible the enactment of socially beneficial legislation that would otherwise not pass. In this paper we reexamine both arguments and show that they depend on the nature of heterogeneity of interests and information across legislators. Under full information, but with heterogeneous ideology, policy compromise may be sufficient to pass beneficial legislation. Pork typically reduces welfare as in the conventional wisdom, but we also characterize cases where pork can indeed “grease the wheels” and improve social welfare. When agents are heterogeneous not only in their ideology, but also their information, allocation of pork may be crucial to passage of legislation appropriate to the situation. It does so not simply by inducing legislators to accept legislation they view as harmful, but also by conveying information about the necessity of policy change, where it may be impossible to convey such information in the absence of pork. Moreover, pork will be observed when the public good is most valuable precisely because it is valuable and the informed agenda setter wants to convey this information. Moreover, information may be conveyed for the reason pork is widely criticized, that is, because it benefits special interests.

Item Type:	Article
Additional Information:	© 2023 The Author(s)
Divisions:	Economics
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences
JEL classification:	D - Microeconomics > D7 - Analysis of Collective Decision-Making > D72 - Economic Models of Political Processes: Rent-Seeking, Elections, Legislatures, and Voting Behavior H - Public Economics > H4 - Publicly Provided Goods > H40 - General E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy Formation, Macroeconomic Aspects of Public Finance, Macroeconomic Policy, and General Outlook > E62 - Fiscal Policy; Public Expenditures, Investment, and Finance; Taxation
Date Deposited:	18 Sep 2023 09:42
Last Modified:	25 Apr 2024 18:15
URI:	http://eprints.lse.ac.uk/id/eprint/120221

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