SEMINAR: Economics Seminar

Abstract: We study regional favoritism using satellite data on nighttime light intensity and information about the birth places of political leaders. In our panel with 38,450 regions from 126 countries with yearly observations from 1992 to 2009, we find that regions have more intense nighttime light when being the birth region of the current political leader. We argue that this finding provides evidence for regional favoritism. We further show that regional favoritism is more prevalent in countries with weak political institutions and high foreign aid inflows or oil rents.