Politicians avoid negative effects of a party scandal by switching parties.

Even when politicians are not personally involved in a political scandal, they can be indirectly affected through their affiliation with the implicated party. One way to avoid this ‘guilt-by-association’ is to distance oneself by switching parties.

In a recent paper, we look at the political shockwaves created by the 1992 Italian ‘Clean Hands’ scandal. This was a massive corruption scandal where public procurement contracts were allocated in exchange for bribes to the two main ruling parties in Italy at the time, Christian Democracy (DC) and Italian Socialist Party (PSI). Hundreds of politicians, entrepreneurs, and public officials were charged with corruption.

By 1994, the two involved parties had imploded and almost completely lost their electoral support. Both were disbanded shortly afterwards, and new parties emerged in their wake – including Berlusconi's Forza Italia and the populist right wing Lega Nord. In fact, the institutional shock of these events was so dramatic that historians define this period as the end of the Italian First Republic.

Using data from local elections in Italy’s roughly 8000 municipalities, we study how local politicians responded to these dramatic events. We found that local politicians affiliated to the involved parties (DC and PSI) were much less likely to stand for re-election, and also much less likely to be re-elected when they did. They were, however, more likely to have switched to another party when they did stand for re-election.

Why did these effects materialize at the local level when the scandal took place at the national level and did not implicate local politicians? We argue that large-scale scandals trigger negative labelling of the involved party or parties by the media, which leads to a negative societal perception of this party. By tarnishing the party brand in this way, political scandals have implications beyond the politicians directly involved. Politicians become guilty by association, just by being members of a scandalized party.

Interestingly, a ‘run-while-you-can’ strategy -- whereby politicians switch to another party -- proved electorally beneficial. It considerably improved politicians’ chances of re-election compared to not switching. Our findings thus suggest that local politicians actively re-optimize their party affiliation in times of scandal by creating distance between themselves and the involved party.

Party switching also had benefits in the longer term. Studying a time period 15 years after the ‘Clean Hands’ scandal showed that leaving a scandalized party protected a politician’s upward career mobility compared to those remaining in the party. In contrast, staying with the party was linked to reduced upward career mobility.

Source: Gianmarco Daniele, Sergio Galletta, Benny Geys, Abandon ship? Party brands and politicians' responses to a political scandal, Journal of Public Economics, Volume 184, 2020, 104172, ISSN 0047-2727, https://doi.org/10.1016/j.jpubeco.2020.104172.

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