What You See and What You Get: Direct and Indirect Political Dividends of Public Policies

Abstract We investigated both the direct and indirect political dividends of public policies by examining Minha Casa, Minha Vida, a housing programme in Brazil that selects its beneficiaries by lottery. We surveyed the lottery participants and found that the winners were not more likely to support the incumbent politicians. Non-beneficiaries, a much larger group, were aware of the programme and thought well of it while the beneficiaries' responses to the programme were sometimes underwhelming. However, politicians considered the programme to be an electoral asset, and a difference-in-differences analysis of electoral results leveraging the roll-out of the programme across municipalities found that presidential and mayoral incumbent candidates performed better in localities that had implemented MCMV. Overall, when the beneficiaries formed a relatively small group, the benefits were conspicuous and the programme's objectives were widely supported. Government programmes can create electoral payoffs independently of how programmes are perceived or experienced by beneficiaries.