How Effective Are Monetary Incentives to Vote? Evidence from a Nationwide Policy

• Authors: Gianmarco León-Ciliotta.
• BSE Working Paper: 1111 | September 19
• Keywords: Peru , external validity , informational frictions , compulsory voting , voter turnout , voter registration
• JEL codes: D72, D78, D83, K42
• Peru
• external validity
• informational frictions
• compulsory voting
• voter turnout
• voter registration

We combine two natural experiments, multiple empirical strategies and administrative data to study voters’ response to marginal changes to the fine for electoral abstention in Peru. A smaller fine leads to a robust decrease in voter turnout. However, the drop in turnout caused by a full fine reduction is less than 20% the size of that caused by an exemption from compulsory voting, indicating the predominance of the non-monetary incentives provided by the mandate to vote. Additionally, almost 90% of the votes generated by a marginally larger fine are blank or invalid, lending support to the hypothesis of rational abstention. Higher demand for information and larger long-run effects following an adjustment to the value of the fine point to the existence of informational frictions that limit adaptation to institutional changes.