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Political Business Cycles and Fiscal Policies in Developing Countries

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Author Info
Schuknecht, Ludger

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Abstract

This paper empirically studies fiscal policies around elections in thirty-five developing countries. It finds that governments try to improve their reelection prospects with the help of expansionary fiscal policies. Rising fiscal deficits before elections are followed by fiscal consolidation afterwards. These cycles can be found particularly in countries which are less trade oriented. Certain IMF-supported programs contribute to fiscal stabilization. Copyright 1996 by WWZ and Helbing & Lichtenhahn Verlag AG

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Publisher Info
Article provided by Blackwell Publishing in its journal Kyklos.

Volume (Year): 49 (1996)
Issue (Month): 2 ()
Pages: 155-70
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Handle: RePEc:bla:kyklos:v:49:y:1996:i:2:p:155-70

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  1. Schröder, Michael & Heinemann, Friedrich & Kruse, Susanne & Meitner, Matthias, 2004. "GPD-linked Bonds as a Financing Tool for Developing Countries and Emerging Markets," ZEW Discussion Papers 04-64, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
  2. Steven A. Block & Burkhard N. Schrage & Paul M. Vaaler, 2003. "DEMOCRACY’S SPREAD: Elections and Sovereign Debt in Developing Countries," William Davidson Institute Working Papers Series 2003-575, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
  3. Axel Dreher & Roland Vaubel, 2002. "Does the IMF cause moral hazard and political business cycles? Evidence from panel data," International Finance 0207002, EconWPA. [Downloadable!]
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  4. Ethan Kapstein & Nathan Converse, 2006. "The Economics of Young Democracies: Policies and Performance," Working Papers 85, Center for Global Development. [Downloadable!]
  5. Christian Bjørnskov & Axel Dreher & Justina A. V. Fischer, 2005. "The bigger the better? Evidence of the effect of government size on life satisfaction around the world," Economics working paper series 05/44, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich. [Downloadable!]
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  6. Min Shi & Jakob Svensson, 2003. "Political Budget Cycles: A Review of Recent Developments," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 29, pages 67-76. [Downloadable!]
  7. Axel Dreher & Roland Vaubel, 2004. "Do IMF and IBRD Cause Moral Hazard and Political Business Cycles? Evidence from Panel Data," Open Economies Review, Springer, vol. 15(1), pages 5-22, January. [Downloadable!] (restricted)
  8. Jula, Dorin, 2008. "Economic Impact of Political Cycles – The Relevance of European experinces for Romania," Working Papers of Institute for Economic Forecasting 081101, Institute for Economic Forecasting. [Downloadable!]
  9. Kapstein, Ethan & Converse, Nathan, 2006. "The Economics of Young Democracies: Policies and Performance," MPRA Paper 553, University Library of Munich, Germany. [Downloadable!]
  10. Andrew Leigh, 2004. "Does the World Economy Swing National Elections?," CEPR Discussion Papers 485, Centre for Economic Policy Research, Research School of Social Sciences, Australian National University. [Downloadable!]
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  11. Marcela Eslava, 2006. "The Political Economy of Fiscal Policy: Survey," RES Working Papers 4487, Inter-American Development Bank, Research Department. [Downloadable!]
  12. Krishna Chaitanya Vadlamannati, 2009. "Does Timing og Elections Instigate Riots? A Subnational Study of 16 Indian States, 1958-2004," Working Papers id:1835, esocialsciences.com. [Downloadable!]
  13. Leonardo Martinez, 2008. "A theory of political cycles," Working Paper 05-04, Federal Reserve Bank of Richmond. [Downloadable!]
  14. Michael Schröder & Friedrich Heinemann & Susanne Kruse & Matthias Meitner, 2007. "Pay high in good times, pay low in bad times," Journal of International Development, John Wiley & Sons, Ltd., vol. 19(5), pages 667-683. [Downloadable!]
  15. Schady, Norbert R., 1999. "Seeking votes - the political economy of expenditures by the Peruvian Social Fund (FONCODES), 1991-95," Policy Research Working Paper Series 2166, The World Bank. [Downloadable!]
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