Can Politicians Police Themselves? Natural Experimental Evidence From Brazil's Audit Courts

Abstract

To enhance government accountability, reformers have advocated strengthening institutions of "horizontal accountability," particularly auditing institutions that can punish lawbreaking elected officials. Yet, these institutions differ in their willingness to punish corrupt politicians, which is often attributed to variation in their degree of independence from the political branches. Taking advantage of a randomized natural experiment embedded in Brazil's State Audit Courts, we study how variation in the appointment mechanisms for choosing auditors affects political accountability. We show that auditors appointed under few constraints by elected officials punish lawbreaking politicians—particularly co-partisans—at lower rates than bureaucrats insulated from political influence. In addition, we find that even when executives are heavily constrained in their appointment of auditors by meritocratic and professional requirements, auditors still exhibit a pro-politician bias in decision making. Our results suggest that removing bias requires a level of insulation from politics rare among institutions of horizontal accountability. Keywords: Latin American politics, corruption, accountability