Essays in Political Economy of Development

The study of political dynasties emerged from the seminal work by Dal Bo et al. (2009). Since then, the literature has focused on showing how incumbency advantage gave rise to political dynasties due to access to resources, name recognition and social networks. Political dynasties were shown to be prevalent worldwide: in North America, Latin America, Europe and Asia. However, the focus has been on classical dynasties that persist through time. My dissertation contributes to the extant literature by studying dynastic structure in greater depth. I introduce the concept of horizontal dynasties, where family members occupy different political offices at the same time. By studying a different structure that dynasties take, I deepen our understanding and unpack the black box of how dynasties function. In the first chapter, I study the impact of horizontal dynasties on local government spending and suggest that this type of structure gives rise to more spending due to better coordination among political actors. In the second chapter, I study dynastic persistence in settings where rank effects are present and show that dynasties trade-off using public information with following family norms of hierarchy and patriarchy to maintain their stability and persistence in politics. Ultimately, this dissertation shows how these informal structures rely on informal norms in order to persist in politics. Dynastic formation is a strategic response to circumvent formal rules and organizations in order to maximize dynastic welfare and perpetuate these informal institutions.