Time inconsistency and fiscal policy: empirical analysis of U.S. States, 1969-89

Article Abstract:

A study of US states' fiscal data from 1969-89 demonstrates that political parties are likely to modify their fiscal policy if they believe they will not hold office for very long. A controlling party, whether liberal or conservative, is likely to form more extreme fiscal policy than its members would prefer, in order to have long-term effects on future regimes. The conclusion is that term limits and frequent elections have a destabilizing effect on the fiscal policy of a state.

Finance, taxation, & monetary policy, Political aspects

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Fiscal consequences of budget baselines

Article Abstract:

A conceptual framework was developed to account for the consequences of varying budget baselines on state fiscal policy. The model was applied to US state data in a ten-year period from 1980 to 1990. Analysis of the period, while taking into account institutional, economic, and demographic factors, showed that the existing services baseline increased the growth rate in state spending by some 5% or about $190 per individual.

Public Finance Activities, Fiscal Policy, Budget, Budgeting, Budgets

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Legislative organization and government spending: cross-country evidence

Article Abstract:

Links between numbers of elected representatives and levels of government spending in democracies are explored in detail. Evidence for the US is mixed, with bicameralism tending to dampen any such link.

Economics, Research and Development in the Social Sciences and Humanities, Democracy

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