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

We study voters’ response to marginal changes to the fine for electoral abstention in Peru, leveraging variation from a nationwide reform. A smaller fine has a robust, negative effect on voter turnout, partly through irregular changes in voter registration. However, representation is largely unaffected, as most of the lost votes are blank or invalid. We also show that the effect of an exemption from compulsory voting is substantially larger than that of a full fine reduction, suggesting that nonmonetary incentives are the main drivers behind the effectiveness of compulsory voting. (JEL D72, K16, O17)