Term-limited politicians pursue a more conservative fiscal policy than those who are eligible for reelection. This applies to right-leaning lame ducks, while left-leaning politicians do not change their behaviour when they are no longer eligible. Dr. Mariana Lopes da Fonseca resorted on a constitutional reform in Portugal which introduced mayoral term limits and studied the latter’s impact on local policy choices.
Her findings are in line with a model of electoral accountability according to which elections serve a disciplinary purpose insofar as politicians remain accountable as long as they are eligible for office. They indicate that right-leaning incumbents pander to the preferences of the redistribution-prone electorate while they are eligible, but adopt policies closer to their true preferences when term-limited.
Published: Economic Journal, accepted for publication.