Democracy and Visibility
Working Paper No. 00-W09
Anandi Mani and Sharun W. Mukand
ABSTRACT [article]
We examine the role of visibility in influencing government
resource allocation across multiple public goods. In an electoral
framework, outcomes are defined to be less visible in tasks if it is
harder to assess government ability based on observed outcomes. Such a
'visibility effect' distorts resource allocation towards more visible
goods. Our model provides an explanation for government neglect in the
provision of several essential public goods, despite their considerable
benefits. It throws light on the even more puzzling phenomena of voter
apathy towards such neglect, and the focus of political competition on
issues with small welfare benefits. We show that, even though greater
democracy does reduce moral hazard in government effort, there need not
be a monotonic improvement in provision of some essential public goods.
Good/services with low visibility are more prone to multiple equilibria
in resource allocation, such that the outcome depends on voter
expectations. We present on evidence on less and more visible public
good outcomes in countries at varying levels of democracy.