1st part of work attached.
CASES IN FINANCE
In regards with the Case of your election that you chose for the Mid-Term Assignment, related to a Financial matter or to an Economic/Enterprise case, explain the SECOND part of the Case.
Within the second part of this Case explanation, please make sure to follow the following structure:
1. Research and Analysis 2. Recommendations 3. Conclusions
Details and Formalities:
· The Assignment is an individual task.
· It shall be submitted in a word document format. If you need to attach some graphics or calculations you can do it as an appendix.
· Wordcount: between 2,000 and 2,500 words.
· Cover, Table of Contents, References and Appendix are excluded of the total wordcount.
· Font: Arial 11 pts.
· Text alignment: Justified.
· The in-text References and the Bibliography have to be in Harvard’s citation style.
Incumbent & wealthy dependence of parties in India.
Table of Contents Executive summary 3 Introduction 4 Methodology 5 Hypothesis 5 Findings 6 Literature review. 7 Conclusion 9 Bibliography 11
Election and finance, especially money, have been dominating in the recently conducted elections globally. This can be witnessed during campaigns and election periods where billion of funds are spent by the candidates themselves to prove their chances. Thus, this report provides an evolution of the electro effects of Incumbent wealth and the reasons behind parties depending on wealthy candidates precisely on Indian elections. It draws facts that in the 2014 countrywide elections, the candidates conveyed a median capital of Rs 23.8 lakh, which is twenty seven times the nominal per capita income in the Republic of India between 2014 and 2015 which was Rs 88,533 (Sircar).
The methods of analysis employed included analytical methods where surveys and questionnaires were offered to various individuals. Additionally, previous research and related research materials were employed to understand this phenomenon happening in India, which represents the most average and glowing economies and countries globally. The research findings indicate that self-financing candidates and dependence of wealthy individuals is a concern as only a subset of the population can be in a position to hold office (Sircar) realistically. Furthermore, the finding depicted that the legislators elected are less familiar with the citizen, leading to less representation of the general public, especially the weak and needy in society.
Thus, the report finds the prospects of the study indicating that the wealthier and money used by an individual during elections their more significant chances of winning. Additionally, the incumbents are the most beneficiaries as they enjoy significant returns on their assets (Milyo and Groseclose). As a result, the recommendations due to the result include having limitations and control by the respective governments in order to control how much a candidate or a part can spend during elections. Additionally, more focus should be made on equality, making sure that all individuals can be able to complete family and financial analysis to candidates in order to understand and identify their source of finding during campaigns and elections in order to prevent and mitigate investment by malicious individuals who are after profits after their preferred candidate is elected in office.
Furthermore, the research investigates the fact that the analysis conducted had limitations such as lack of sufficient previous research on the matter, lack of cooperation by some of the individuals involved, and finding the key reason why Indian parties truly depend on wealthy individuals. Additionally, data limitations were evident as the current economic times have been affected by the pandemic; thus, more focus has shifted on the pandemic rather than elections and such occurrences.
The rise of wealthy candidates has long been driven by the weak representative role of the elected politicians in India who have discouraged quality governance and will continue to do so. The resulting outcome is elected leaders and politicians viewing their political bids and campaigns as an economic investment in the future. Furthermore, aggressive demonstrations by wealthy candidates have increased in the high-level world of elections and campaigning in the last decade (Koerth). Globally, candidates of elections have been spotted dishing out cash handouts to their supporters to convince them to vote for them.
Despite money playing an essential and significant role in the majority of the elections globally, Indian’s political parties’ reliance on contenders with a significant private wealth is fairly an exclusive phenomenon. This is because this is contrary to many longstanding democracies. In such cases the most campaign funding is highly regulated by the government and the Lion’s Finance Share is sourced from the various respective parties of the candidates or at times third party sources including corporate actors and as a result the candidates’ wealth is often less critical.
This research took massive use of a quantitative research strategy in the sense that numerical data and quantitative data were produced. For this research, three essential research methods were employed. This involves using previous data and research on the topic and combining the two classic social sciences research tools, questionnaires, and surveys. The questionnaires were distributed among random individuals within the school, especially students affiliated or of Indian origin. This was aimed at sourcing data and information from natives as it would provide a more accurate data result as compared to other individuals. Online Surveys were conducted.
It contained survey questions that were easily deployed to respondents online, and this was don’t through various social media platforms, including WhatsApp and Instagram. Online surveys were necessary as they are easier to design and deploy, and thus as the answers are anonymous, the respondents will most likely give unbiased responses. Previous research involves using the internet to search for a similar or related topic, with the main topic focusing on peer-reviewed documents to have credible results for the research. Due to time and geographical areas’ limitations, the research mainly relied on online published articles and previous research online.
Despite India being a struggling economy and a third-world country, its elections are the most unique. There is a greater likelihood of upcoming candidates depending on Incumbent individuals; however, why are Indian political parties becoming highly reliant on wealthy candidates?
To respond to this hypothesis, one must first comprehend how candidates are chosen, especially in the policy-making position of legislators in the Indian political system. In India’s parties, “intra-group democracy” refers to the fact that decisions within a party are often taken by a tiny coterie of party elites (Sircar). Furthermore, in the absence of a functional democratic mechanism, the tickets released by a party are traditionally circulated and at times sold by those insiders.
Another course is that the law effectively inhibits an elected representative despite getting elected in a seat from many policy-making roles. As a result, third-party actors have less incentives to invest, especially in specific candidates rather than the party itself, in such a scenario. As a result of having fewer opportunities to raise funds from outside sources, candidates have no choice but to finance their election campaigns massively.
As a result of the mentioned course of candidate funding their campaigns, it has naturally led to the development of the wealthy candidate’s rise. This is because they are the kind of individuals who can fund their own political campaign endeavors. Based on the rescue findings between 2004 & 2014, self-reported candidates’ affidavits for the Lok Sabha election, the finding indicates a corresponding increase of approximately 330% in nominal terms. Additionally, despite adjustment due to inflation, the median wealth of candidates remained high, resulting in a 116% real-term increase.
Furthermore, candidates in the 2014 national election posted a median wealth of RS 23.8 lakh (approximately 32,742 dollars), which was roughly 27 times India’s nominal per capita income between 2014 and 2015, making them considerably wealthier than the general population (Sircar).
The study aimed to establish and focus on money matter, how money has an influence and affects elections, and the reason behind parties depending on wealthy candidates during the election period.
Money, or rather the presence of finances, has massive influences on elections globally. In the past decade, a new and astonishing phenomenon has been identified in India. Rather than having the candidates funded by their respective parties, the elections are instead funded by few wealthy individuals in the society, or the elite and wealthy take part in the election as candidates. This indicates a lack of control, and as a result, the elective seats have been occupied by individuals who are materialistic as they are looking for ventures to invest their finances in order to scope profits (Potter and Morgan). However, despite this kind of system working in favor of some candidates, there has a significant retardancy in democracy growth, discouraging quality governance. The result is a struggling economy and the elites in the society being involved in policy-making procedures.
As a result, there has been a reason to worry about following the typical rise of “self-sponsored” candidates. Initially, the benchmark for one to contest in India’s election is being a wealthy individual or having a wealthy individual behind you to inject funding and money into your campaigns. This leads to a small subset of the Indian population that has the capability of holding office. The results are a reign with congresspersons that have fewer in common things with the nation’s residents they are entitled to represent.
Another critical concern is that if the primary concern by political parties is seeking and reviewing an individual’s wealth instead of the expected characteristics, including quality due to education background and constituency service, the politicians who will be elected may become the worse at their representatives of the citizens and this will lead to failed government and democracy in general.
While it’s clear that when self-financed campaigns are translated to poor leadership and democracy, it’s uncertain the pursue of those leaders in terms of representation of their citizens rather than contesting as an investment relatively than a dashed cost. What follows is high levels of corruption in the office, mainly because such leaders will be moving to recoup the costs of contesting elections and replacing the finances used during the periods of campaigning.
“Money changes everything,” according to philosopher Cyndi Lauper, and this metaphor has been taken to heart in today’s elections, where billions of dollars are collected and spent under the assumption that money is a critical determinant of whether a candidate loses or wins an election. (Potter and Morgan). This literature proves that when a candidate is loaded with money and uses it during their campaigns and election periods, there is a higher chance that such a candidate will win the election. Money makes it possible for the candidate to visit as many individuals and states as possible, especially for a presidential candidate. Additionally, such candidates are able to afford state-to-earth services such as social media handlers; transport means the advertisement in the various broadcasting media including TV and radio.
According to the Wesleyan Media Project (2018) analysis in the 2018 election, there was increased advertisement mentioning the presidential candidates more than it had been experienced in the US elections’ history (Baum). The former president Trump, at the time, was mentioned positively in 14.8% of the total federal election advertisements totaling twenty-seven thousand adverts in general in only two months. This suggests that India is not the only place that money rules the elections and that being well funded puts a candidate in the spotlight, translating to their win. But for India, they have taken it a notch higher as overdependence on wealthy parties and individuals has increased rapidly to the extent that it has been alarming the global fraternity.
The most unfortunate thing is that a certain high percentage of the money used is from dark sources such as illegal activities and drug activities, as the money sources are never disclosed. According to Potter, T., & Morgan (2013), an estimated 6 billion dollars was used in the US Federal election of 2012, where 3.14 billion dollars was spent by the federal candidates and 1.034 billion by the political parties. This indicates the power money has in influencing elections and if the united states candidates can dwell in hefty sourcing and funding in election imagine what Indian leaders and candidates can do considering that there is deficient control of the amount and sources of funding of candidates to control their expenditure and funding in the Republic of India.
The research done focuses on portable wealth, which included possessions that can be mobilized swiftly for the purposes of campaigns. This is because such wealth can be nested into cash, deposits, vehicles, and jewelry, and jewelry is the most common as it’s small and carries many financial values. As a result of India’s eventualities, there is a significant growth as political parties are busily sleeting withier candidates rather than focusing on representing their citizens and offering the necessities to their citizens. There is a need for international bodies to intervene to stop this menace as its continuity will lead to bad governance, and India’s economy will continue struggling, primarily due to the ongoing global pandemic that has crippled many economies globally.
Baum, L., 2018. GOP Praise Trump at Record Rates. Wesleyan Media Project. Available at: https://mediaproject.wesleyan.edu/aug-2018/ [Accessed March 14, 2021].
Koerth, M., 2018. How Money Affects Elections. FiveThirtyEight. Available at: https://fivethirtyeight.com/features/money-and-elections-a-complicated-love-story/ [Accessed March 14, 2021].
Milyo, J. and Groseclose, T., 1999. The electoral effects of incumbent wealth. The Journal of Law and Economics, 42(2), pp.699-722.
Potter, T. and Morgan, B.B., 2013. The History of Undisclosed Spending in US Elections & How 2012 Became the Dark Money Election. Notre Dame JL Ethics & Pub. Pol’y, 27, p.383.
Sircar, N., 2019. Money Matters in Indian Elections: Why Parties Depend on Wealthy Candidates. Carnegie Endowment for International Peace. Available at: https://carnegieendowment.org/2018/07/26/money-matters-in-indian-elections-why-parties-depend-on-wealthy-candidates-pub-76926 [Accessed March 14, 2021].