Reward from public office and selection of politicians by parties

We investigate the relationship between quality of politicians and reward from public office in a game between parties and citizens, in which parties play a crucial role in the selection of candidates. Citizens who wish to become politicians have to become party activists first. Parties produce information about the quality of potential candidates. An increase in the reward from public offices leads to two opposing effects on the average quality of politicians. First, a selection effect, whereby more skilled citizens enter politics, leading to an increase in average quality. Second, an information manipulation effect such that parties have incentive to manipulate information to increase the probability to be elected of unskilled activists, from whom they can extract higher rents. We find that, for a plausible range of parameters values, the information manipulation effect dominates the selection effect when - 1) The cost of manipulating information is low enough; 2) The amount of information that parties can provide at no cost is low enough; 3) The net gains from becoming a politicians for unskilled citizens is sufficiently larger than that for skilled citizens. These findings provide a rational for the ambiguous sign of the empirical correlation (relationship) between quality and pay of politicians.