Political competition is widely recognized as a mediator of public goods provision
through its salutary effect on incumbents’ electoral incentives. We argue that political
competition additionally mediates public goods provision by increasing the inefficiency
of legislative bargaining. These countervailing forces may produce a net negative effect
in places with weak parties and low transparency – typical of many young democracies.
We provide evidence of a robust negative relationship between competition and
local public goods using panel data from Mali. Tests of mechanisms corroborate our
interpretation of this relationship as evidence of legislative bargaining inefficiencies. To
explore the generalizability of these findings, we analyze cross-country panel data and
show that political competition leads to better (worse) public goods provision under
high (low) levels of party system institutionalization. The paper sheds light on why
political competition is only selectively beneficial, and underscores the importance of
considering both the electoral and legislative arenas.