THE POLITICAL SYSTEM OF THE SPANISH RESTORATION

In 1874 the Bourbon dynasty returned to the Spanish throne, after a six-year period in which the country was convulsed by violent political conflict. From the start, political leaders who supported the return of the monarchy sought to create institutional stability by building consensus among a large proportion of the liberal elite. This represented a crucial change in relation to Isabel II's reign (1833–1868), when power was monopolized by certain factions, and a growing share of liberals decided that violence and military uprisings were the only available means to gain power. Indeed political violence led to the collapse of Isabel II's regime in 1868 and to six years of instability. The 1874 Restoration attempted to reform the pre-1868 parliamentary monarchy in order to make it more stable and peaceful without engaging in deeper political and social reforms. From this point of view, the regime was a success, as it was more durable than previous parliamentary experiences.Footnote ¹²

In order to avoid conflict and enhance political stability, the Restoration's conservative founders did not seek to reestablish their former political monopoly. They decided instead to collude with the moderate liberal opposition. This was the origin of the so-called turno pacífico (peaceful turn) system, based on a cartel agreement between the two hegemonic parties (conservatives and liberals) which lasted for almost half a century. During that period, those two dynastic parties formed a duopoly that alternated in government with the collaboration of the Crown, who put its constitutional role at the service of the stability of the system. The arrangement was willingly accepted by a large portion of the Spanish social elite, who shared the objective of political stability without social or political reform.Footnote ¹³ Moreover, the pact kept both the antiliberal sectors of the Catholic right and groups of leftist republicans and revolutionaries out of the government.Footnote ¹⁴

In practice, the turno pacífico system operated as follows: each parliamentary election was preceded by the king's appointment of a new prime minister (Presidente del Consejo), usually from the dynastic party that was not in the current government. Then, with a new government in office, the Parliament was dissolved. Elections were organized under a system of mostly simple majority uninominal districts (except for a few, mainly urban, plurinominal constituencies).Footnote ¹⁵ Before the election took place, the new government planned its results in the so-called encasillado, which identified who was the officially sanctioned candidate for each district. As might be expected, the encasillado always involved the overall electoral victory of the new ministry.Footnote ¹⁶

However, in spite of the electoral results being planned in Madrid, the center did not control the voting process, due to its limited capacity to intervene at the local level. Indeed, at the time, the province constituted “the most important level of political and social life in Spain.”Footnote ¹⁷ Elections were actually overseen at the district level by the local public authorities, under the influence of the local elites (caciques). These local actors controlled the electoral outcomes through a variety of means, such as vote buying, coercion and mass fraud, but also by promising individual favors or indivisible benefits to the electorate. Favors and benefits were to be obtained from the administration thanks to the influence of the elected candidate. Individual favors included exemption from military service, personal interventions in the judicial system, job offers, etc., whereas the most usual indivisible favors were roads, railways, dams, or public buildings (schools, markets, etc.), as well as a preferential treatment in the distribution of the tax burden among districts.Footnote ¹⁸ As a result, after each election public funds were channeled by MPs to their districts and used by the caciques to maintain the loyalty of their clients.Footnote ¹⁹ Restoration Spain was therefore a typical semi-democratic country in which candidates built their credibility by exploiting preexisting patron-client networks.Footnote ²⁰

Therefore, throughout the Restoration, winning elections required candidates to negotiate support at the local level. They could do so as representatives of the two-party duopoly. Since most local elites did not have a clear party identification, they might be willing to adapt to the duopoly alternation system and give their support to a different party and candidate in each election, if this would grant them more resources. However, some individual candidates, independently from their party of affiliation, proved especially capable in obtaining administrative benefits in Madrid. In this case, local elites preferred having stable links with these effective MPs and to ignore the turn. Those candidates would then be repeatedly elected by their districts, regardless of the party in power, and would become candidatos propios, who were said to “own” an electoral district. Actually, some of them belonged to the same regional social elites they represented. These candidates' relative independence from the duopoly's global strategy was reinforced by the lack of a centralized structure in the dynastic parties, which were, especially at the beginning of the period, little more than weak aggregations of cliques and personal factions.Footnote ²¹ As a consequence, some historians have described the Spanish central administration as “a political market where local sectors negotiated competitively” through their MPs.Footnote ²²

To sum up, during the Restoration the government could not impose electoral results. Instead, it had to buy the support of the local elites to the official candidates and, in districts where alternative candidates had strong local links, the pressure of the governments of the duopoly to impose the turn might be ineffective.Footnote ²³ This, together with the regime's general objective of securing consensus, helps to explain that there was always a significant representation of nongovernmental parties in the Parliament. To begin with, the dynastic party that was not in office always had a large number of MPs, which amounted, on average, to one-quarter of the Congress throughout the Restoration. Moreover, the Parliament included an initially small but growing number of MPs belonging to some right and left-wing minority parties. These were mainly composed by several republican groups, followed by various regionalists and traditionalists parties and also (by the end of the period) a few members of the socialist party. By the early 1920s these outsiders accounted for about 20 percent of the chamber.

Despite this parliamentary diversity, the turno pacífico was quite successful in achieving institutional stability. Relative to the chronic political turmoil (frequent military uprisings, revolutionary attempts, and regime changes) of the previous decades, the Restoration system operated without interruptions for half a century. However, the regime faced increasing challenges as time went by, which hindered the long-term continuity of the turn system and finally provoked its complete breakdown and the establishment of a military dictatorship, under the auspices of the Crown, in 1923.

The crisis of the Restoration became apparent starting in the 1890s, although its triggers had been in place since the establishment of the regime. Those triggers were both external and internal to the political system.Footnote ²⁴ From the point of view of the internal operation of the regime, local powers progressively gained influence to the detriment of central power, and local elites established therefore more stable links with those candidates (propios) who had proved efficient in obtaining benefits for their districts.

Several reasons explain a strengthening of ties between candidates and local elites. To begin, the passage of time itself proved to the local powers that the cartel between the conservative and the liberal party would endure, and that their cooperation was not necessary to avoid a breakdown of the two parties' agreement. As the cartel consolidated, the local elites' need to follow the two-party alternation system was probably perceived as less stringent. The passage of time also reinforced the local clientelistic networks, in which the candidates exerted the role of intermediaries with the central administration. In that context, the establishment of permanent links between the districts and certain candidates favored the regular operation of these clientelistic networks.Footnote ²⁵ Finally, given the two main parties' lack of a centralized structure and the gradual crisis of the regime, the candidates increasingly tended to “look for security in a guaranteed local power base.”Footnote ²⁶ As a consequence, the propios MPs, which did not adapt to the encasillado, became an intrinsic part of the Restoration institutional system.

Nevertheless, the main challenges to the political system of the Restoration came from outside the dynastic parties. As has been indicated, the regime required the liberal elites to agree to share power in return for political stability. However, since the last years of the nineteenth century, the liberal consensus could no longer guarantee stability, for several reasons. On the one hand, the Restoration institutional setting, which was largely based on the capacity of influence of the rural powers, did not adapt to the slow modernization of the country and the urban sectors' increasing presence in the Spanish economy and society. This led a growing share of the urban elites to feel unsatisfied with the governments of the cartel and seek out other representatives.Footnote ²⁷ At the same time, the labor movement had grown enough for the system to face both a new set of demands of economic and social reform and renewed revolutionary threats. Finally, the monarchy's legitimacy eroded slowly because of an omnipresent corruption and, more sharply, after its defeat in the Spanish American War of 1898. As a consequence, after 1900 the minority parties, which promoted reforms based on ideological arguments, gained influence in a number of Spanish towns, where elections became increasingly competitive.

Electoral competition was also bolstered by the establishment of universal male suffrage in 1890.Footnote ²⁸ This constitutional change was one of the most visible concessions made by the Restoration regime to the progressive liberal elites. The universal male suffrage was a key component of the political program of the Liberal Party, and a necessary condition for both its integration in the regime as a government force and the acceptance of the Constitution by the moderate ranks of the pre-1874 revolutionaries.Footnote ²⁹ However, this measure actually undermined the dynastic parties. Indeed extensive fraud and vote-buying could only limit the representation of minority parties in the first few elections under universal male suffrage. In fact, after 1900 the extension of the franchise made increasingly difficult to control electoral results in urban constituencies. There, elections gradually became more competitive and based on modern political practices.Footnote ³⁰ At the same time, in rural districts, universal male suffrage forced candidates to reinforce their links with local clientelistic networks.Footnote ³¹

Figure 1

DYNASTIC OPPOSITION AND MINORITY PARTIES' MPs AS SHARE OF TOTAL

Sources: Varela Ortega, Poder; Sánchez de los Santos, Las Cortes españolas: 1907 and Las Cortes españolas: 1910; El año político (1895–1910); El Imparcial (1876); El Liberal (1881–1910); La Correspondencia de España (1879–1905); La Época (1879–1905); ABC (1905); and data provided by Javier Moreno Luzón.

The erosion of the Restoration's stability accelerated after World War I. Between 1917 and Primo de Rivera's military coup d'état in 1923, the government found it increasingly difficult to obtain a parliamentary majority and social turmoil was constant, with a growing share of society demanding political reform. However, as has been indicated, the origins of the crisis can be traced back to the first decades of the Restoration period. As may be seen in Figure 1, the out-of-office dynastic party's share of elected deputies kept growing over time. The same was true of the minority parties' representation. As a consequence, the margin between the two dynastic parties contracted over time and, more importantly, the margin between these parties and the minority ones became smaller.

In sum, over time the strength and stability of the Restoration regime eroded to the point that Spain could only go one of two ways: democratic reforms or the elimination of the parliamentary regime. Actually, both solutions were tried during the interwar period. Before 1923, however, the political duopoly survived in an increasingly weak position, and this was probably reflected in a gradual change in its priorities. In the early Restoration years, the government focused on consolidating the two-party cartel and marginalizing other political forces. After 1890 the regime tried instead to keep discontent under control and to appease those social sectors demanding profound reforms.Footnote ³²

THE ALLOCATION OF PUBLIC RESOURCES DURING THE RESTORATION: THE ROLE OF GOVERNMENTS AND INDIVIDUAL MPs

Our main hypothesis is that the mix of government vote-buying and local autonomy shaped the allocation of road resources among provinces. On the one hand, governments subordinated the distribution of resources to the duopoly's global objectives. In the short run, these objectives reduced to implementing the turn system; in the long run, they included maintaining political stability without reform. On the other hand, MPs competed to obtain resources from the government, in order to increase their reputation and strengthen their links to elites in their districts. In the next paragraphs, we suggest some hypotheses as to how those two sets of factors might have affected the distribution of public expenditure during the regime and how their relative influence might have evolved with social and political change.

EMPIRICAL FRAMEWORK

Investigating these hypotheses is perforce limited by the availability of data. On the one hand, because road expenditure data are only reported by provinces, but not by electoral districts, we had to aggregate electoral outcomes data by province, and carry out the analysis at the provincial level. This unavoidable spatial aggregation has forced us to smooth local variation and introduces a measurement error problem in the analysis, for which no straightforward solution is available. There are, however, some reasons that may have reduced the incidence of this problem. Indeed, as Carlos Dardé et al. note, a significant number of provinces showed certain political unity during the period under study.Footnote ³⁸ More importantly, local elites would not only be interested in an increase in their district's road mileage, but also in having a good connection with the main markets (such as the provincial capital), which would involve the completion of some provincial roads which ran partially out of their own district territory. Therefore, broadly speaking, the local elites of all districts in each province would actually be interested in the development of the whole provincial road network.

On the other hand, since road investment in the Basque Country and Navarre was mostly financed and executed by the provincial administrations (Diputaciones), we have excluded these four provinces (Álava, Biscay, Guipúzcoa, and Navarre) from the analysis. Hence, our final sample consists of a set of 45 provinces with an average of 309 districts and 372 elected deputies per election.

We have restricted our analysis to road expenditures undertaken by the central government between 1880 and 1914. We start in 1880, the year that followed the 1879 election, which is considered the beginning of the turno pacífico system. The 1914 adoption of the Ugarte Plan, which reduced the government's discretion over road construction spending, makes that year a good ending point. We assume that a given year's investment was influenced by the results of the nearest previous election. In the case of election years, we consider that the expenditure made by the government during the year was not influenced by that year's election outcomes. This is reasonable given that once approved, infrastructure spending was delayed by a somewhat involved implementation process. In other words, politicians needed some time before their influence on investment showed up at the local level. As a result, we include the following elections: 1879, 1881, 1884, 1886, 1891, 1893, 1896, 1898, 1899, 1901, 1903, 1905, 1907, and 1910.

Our dependent variable is annual expenditures on new road construction in constant pesetas per capita.Footnote ³⁹ Information on public road investment has been extracted from the Memorias, Anuarios and Estadísticas de Obras Públicas, which were published regularly by the Spanish Ministry of Public Works (Ministerio de Fomento) between 1856 and 1924.Footnote ⁴⁰

The independent variables are all measured annually and at the provincial level. To capture the economic demand for roads, we estimate the impact of population density and the level of GDP per capita.Footnote ⁴¹ The time gaps in these variables have been filled through interpolation. We expect provinces with lower population density to get larger construction investment per capita (since a higher level of spending would be necessary in those provinces to connect a given amount of population to the network). The opposite (positive) effect should hold in the case of richer (in terms of per capita GDP) provinces.

We then add electoral data. In this regard, the main source of information is the appendix to the book El poder de la influencia, edited by José Varela Ortega, which contains the name of a large share of the deputies that were elected in each district from 1876 until 1923, as well as their party of affiliation. This database, however, has numerous gaps, which have been filled by drawing on Modesto Sánchez de los Santos' volumes on the chambers elected in 1907 and 1910,Footnote ⁴² the yearly publication El año político (1895–1910), some of the newspapers published in the days after each election (El Imparcial, El Liberal, La Correspondencia de España, La Época, and ABC) and the Historical Archive of Deputies (1810–1977) of the Spanish Congress.Footnote ⁴³

This new data set allows us to calculate the Relative seniority of each MP, which measures the difference between the maximum seniority in the chamber after each election and the seniority of each deputy.Footnote ⁴⁴ We then average that variable over the deputies in each province. The lower this indicator (the lower this difference), the more senior these deputies were, and the more able they would be to attract resources to their constituencies. Second, we measure the share of deputies in province i and term t who had been ministers in previous terms, as a proxy for their long-term political influence. Those MPs with a greater leadership position should garner more public funds for their provinces. Third, to capture the presence of propios MPs in province i and term t, we measure the share of deputies who: i) had been elected in the past in the same district; and ii) had sat with the opposition for at least one term of office (i.e., had not adapted to the turn system).

Finally, we divide the elected MPs into three types: government MPs, dynastic opposition MPs (Liberal MPs under a Conservative government and Conservative MPs under a Liberal government), and minority MPs (those not running as either Liberals or Conservatives). We then calculate the share of deputies belonging to the dynastic opposition and the share that belonged to the minority parties in each province.Footnote ⁴⁵Table 1 presents a summary description of the variables and their descriptive statistics and data sources.

Table 1

DESCRIPTIVE STATISTICS AND DATA SOURCES

Note:

Subindex it refers to province i and year t.

Sources:

For Road investment p.c., Ministerio de Fomento, Memorias, Anuarios and Estadísticas de Obras Públicas (1880–1914). For Minority seats (%), Opposition seats (%), Propios (%), Deputies who were ministers in the past (%), and Relative seniority, Varela Ortega, Poder, Sánchez de los Santos, Las Cortes españolas: 1907 and Las Cortes españolas: 1910, El año político (1895–1910), El Imparcial (1876), El Liberal (1881–1910), La Correspondencia de España (1879–1905), La Época (1879–1905), ABC (1905), and Historical Archive of Deputies (Spanish Congress). For Population density, Population censuses, and for GDP pc, data provided by Julio Martínez-Galarraga.

Taken together, these data form a panel comprising 35 years (distributed among 14 elections) and 45 provinces. Since we can observe the behavior of units (provinces) at different points in time, we can capture variation between units as well as over time by using a linear panel data model with both time and province fixed effects as follows

where i_it is investment per capita on roads; Political_it includes the political variables linked to our hypotheses; X_it accounts for economic variables that change over time; α_t represents year-specific effects capturing the impact of certain factors (such as economic crises, national policies, etc.) that occurred in a given year and affected all provinces; α_i represents province effects, accounting for factors that are specific to a given area but constant in time (e.g., construction costs, maritime and border provinces, etc.); and u_it is an error term.

Regarding the estimation method, since the results presented treat the province effects as fixed, this means that we identify the effects of political variables from within-province variation over time. Finally, according to several tests performed, the disturbances in our panel are both heteroscedastic and autocorrelated, which makes clustering at the province level necessary. Also, the fact that the value of the political variables is the same for the years between two consecutive elections indicate that clustering at the election level is also necessary. So, we cluster standard errors both by province and by election.

THE POLITICS OF ROAD SPENDING

Table 2 presents the outcomes of a set of regressions based on equation 1. Column 1 presents the fixed-effects estimates obtained from the baseline model (economic variables only) and columns 2 to 5 present the results when we include political variables. In all the regressions, the coefficients of the economic variables are statistically significant and have the expected sign: public investment per capita on road construction was lower in densely populated provinces and higher in provinces with larger GDP per capita.

To evaluate the impact of political factors, let us focus on column 5, which is based on the full model—the other specifications have much the same results. We find no evidence that either the share of minority MPs or the share of the dynastic opposition MPs had a statistically significant effect on the amount of road investment received by a province. By contrast, the proportion of propios had a significant and positive impact on road investment. It thus seems that propios did not have lower incentives to lobby for their provinces, and instead it appears that they were particularly good at attracting resources for their provinces. More precisely, a standard deviation rise in the share of propios among a province's deputies would produce a 0.17 pesetas increase in per capita investment on roads (i.e., 16 percent of the standard deviation of the dependent variable). Similarly, the higher the provincial share of deputies that had been ministers in the past, the greater the road funds that province received.Footnote ⁴⁶ More concretely, a standard deviation rise in this variable would translate into a 0.33 pesetas increase in road investment per capita (i.e., 31 percent of the standard deviation of the dependent variable).

Table 2

DETERMINANTS OF THE REGIONAL ALLOCATION OF ROAD INVESTMENT DURING THE SPANISH RESTORATION

* = Significant at the 10 percent level.

** = Significant at the 5 percent level.

*** = Significant at the 1 percent level.

Notes:

(1) The figures in parentheses are t-statistics; (2) dependent variable: road investment per capita; and (3) all columns include provincial and time fixed effects.

By contrast, the coefficient of the relative seniority of each province's MPs is not statistically different than zero, a result that, at first sight, seems surprising. There are, however, two possible complementary explanations for that. First, in line with suggestions made by Kevin Milligan and Michael Smart, once the seniority of a politician exceeds a certain threshold, his expectations of running for reelection might fall and, as such, he might relax his efforts in attempting to obtain spending for his district.Footnote ⁴⁷ Second, the provincial share of propios MPs increased a province's allocation of road investment. By definition, these deputies were senior, so it seems that seniority was only relevant when the MP was politically independent and did not respect the turn.

As was suggested in Section 3, the governments' attitude towards the provinces that did not respect the turn may have changed with the gradual erosion of support for the Restoration. This may explain the lack of significance of the variables that measure the share of minority or dynastic opposition MPs when we test their impact over the whole period. In order to account for the presence of structural change in the relationship between the political variables and road spending, we have run two additional sets of regressions. In the first one, whose results are reported in Table 3, we consider that the changes in the governments' attitude towards the “rebellious” provinces were mainly associated to the exogenous shocks that took place in the 1890s (such as universal male suffrage or the colonial defeat). Therefore, we define a time dummy variable for the second part of the period under analysis (1892–1914), which is interacted with both the share of minority and dynastic opposition deputies.Footnote ⁴⁸ This approach allows us to test for level differences between elections before and after 1890.

Table 3

DETERMINANTS OF THE REGIONAL ALLOCATION OF ROAD INVESTMENT DURING THE SPANISH RESTORATION. INTERACTION OF A DUMMY FOR THE SECOND SUBPERIOD (1892–1914) WITH THE POLITICAL FACTORS

* = Significant at the 10 percent level.

** = Significant at the 5 percent level.

*** = Significant at the 1 percent level.

Notes:

(1) The figures in parentheses are t-statistics; (2) Dependent variable: road investment per capita; and (3) all columns include provincial and time fixed effects.

As an alternative, we ran a second set of regressions, whose results are presented in Table 4, and where we assume instead that the governments' change of attitude was gradual, being mainly the result of the country's socioeconomic evolution and the slow weakening of the political system. We evaluate this alternative hypothesis by interacting the political variables with a linear time trend as follows

In both tables, column 5, which shows the coefficients of the full model, confirms the hypothesis that the governments' attitude towards the provinces that did not respect the turn changed over time. In Table 3, higher shares of minority and dynastic opposition MPs reduced government expenditure on road construction during the early years of the period under study, but that effect was reversed after 1890. In addition, during the second subperiod, the positive impact of having a higher share of nongovernmental MPs was much smaller in the case of dynastic opposition deputies, something that is consistent with the fact that they represented less of a threat to the regime. More precisely, the coefficients in column 5 indicate that, during the first period, raising a province's share of minority MPs by one standard deviation would provoke a decrease of 0.17 pesetas in road construction per capita in that province (i.e., 16 percent of the standard deviation of the dependent variable). In contrast, during the second period, the same standard deviation increase would have translated into an uptick of 0.11 pesetas per capita (i.e., 10 percent of the standard deviation of the dependent variable). As for the dynastic opposition MPs, they produce similar effects to minority deputies in the first period and just a 2 percent increase during the second one.

The results reported in Table 4 are also consistent with the hypothesis that the regime changed its attitude towards the “rebellious” districts. In this case, using again the coefficients presented in column 5 we can see that in an initial year (t = 1) a single standard deviation rise in the variable Minority seats (%) led to a 0.23 pesetas decrease in per capita road investment. However, this effect changed over time and, by 1914 (i.e., at t = 35) the effect of an increase of one standard deviation in this variable was a rise of 0.20 pesetas per capita in road investment. Finally, in both tables, the effects of the other political variables capita road investment. However, this effect changed over time and, by 1914 (i.e., at t = 35) the effect of an increase of one standard deviation in this variable was a rise of 0.20 pesetas per capita in road investment. Finally, in both tables, the effects of the other political variables (Propios, Deputies who were ministers in the past, and Relative seniority) remain unchanged from those reported in Table 2.Footnote ⁴⁹

Table 4

DETERMINANTS OF THE REGIONAL ALLOCATION OF ROAD INVESTMENT DURING THE SPANISH RESTORATION: INTERACTION OF A LINEAR TREND WITH THE POLITICAL FACTORS

* = Significant at the 10 percent level.

** = Significant at the 5 percent level.

*** = Significant at the 1 percent level.

Notes:

(1) The figures in parentheses are t-statistics; (2) Dependent variable: road investment per capita; and (3) all columns include provincial and time fixed effects.

To sum up, although these two specifications involve different assumptions on the evolution of the relationship between road spending and the political variables, both are consistent with our main hypothesis about the evolution of the regime.Footnote ⁵⁰ In both cases, the results of the estimation indicate that, in the early stages of the Restoration, political stability required the government to distribute relatively less road investment to those provinces where deputies were elected without regard to the turn. By contrast, as time went by and the crisis of the regime became apparent, such punishments did not work and the government tended to change its criteria for the allocation of road funds. As a result, over time, those provinces where the turn system was less respected and, even more so, those electing candidates from the minority parties, tended to receive more resources, probably in an attempt to limit discontent and to appease those social sectors demanding profound reforms.