Making the Cut: Close Elections and Local Welfare Policy
Abstract
This paper investigates how political alignment affects the implementation of punitive welfare measures in the UK. In particular, we examine whether a legislator’s party affiliation affects the rate of sanctions to unemployment benefits in the MP’s constituency. To address the endogeneity of winning party and constituency characteristics, we use a regression discontinuity design based on close elections to compare the sanction rates across constituencies that are marginally aligned or unaligned with the central government. We find that implementation of the sanction regime is significantly more lenient in constituencies won by the government-aligned parties. The RD estimate indicates a drop of .8 percentage points, implying on average 18 % lower sanction rates in central government controlled constituencies. Our findings show that legislators are able to influence local implementation of national, rule-based policies, even within a highly centralized system. Such political influence undermines institutions that should be neutral to local partisan considerations.
