Online Local Budget Transparency and Local Elections in Croatia

ABSTRACT This study empirically analyses the impact of online local budget transparency (OLBT) on the electoral performance of city mayors and municipal heads who sought re‐election in Croatia's local elections in 2017 and 2021. Based on the literature on political budget cycles (PBC) and voting behavior, the study tests two main hypotheses: (1) that budget transparency is rewarded by voters; and (2) that it diminishes the electoral benefits of opportunistic pre‐election increases in expenditures. These hypotheses are examined using fixed‐effects panel models applied to data from up to all 556 Croatian cities and municipalities where incumbents ran for re‐election. The dependent variable is the vote share received by the incumbent in the first round of the local elections. The empirical results provide support for both hypotheses.