Resource information
The paper estimates the effects on
presidential election returns in Mexico of a government
climatic contingency transfer that is allocated through
rainfall-indexed insurance. The analysis uses the
discontinuity in payments that slightly deviate from a
pre-established threshold, based on rainfall accumulation
measured at local weather stations. It turns out that
voters reward the incumbent presidential party for
delivering drought relief compensation. The paper finds that
receiving indemnity payments leads to significantly greater
average electoral support for the incumbent party of
approximately 7.6 percentage points. The analysis suggests
that the incumbent party is rewarded by disaster aid
recipients and punished by non-recipients. The paper
contributes to the literature on retrospective voting by
providing evidence that voters evaluate government actions
and respond to disaster spending.
