The Real Winner's Curse

Traditional theories of democracy suggest that political representation of excluded groups can reduce their incentives to engage in conflict. We consider the response of elites whose power is threatened by new political actors and study the consequences of political inclusion in a context of weak institutions. Using a regression discontinuity approach, we show that the narrow election of previously excluded left-wing parties to local executive office in Colombia results in an almost one-standard-deviation increase in violent attacks by right-wing paramilitaries. We interpret this surge in violence as a de facto reaction of traditional political and economic elites, who seek to offset the increase in outsiders' de jure political power. Consistent with this interpretation, we find that violence by left-wing guerrillas and other actors is unaffected, and that levels of violence are not influenced by the victory of right-wing or other new parties in close elections