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Does political fragmentation lead to budgetary incrementalism? An empirical test on the French local public sector

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  • Benoît Le Maux
  • Wenjia Zhang

Abstract

This paper tests for the impact of political fragmentation on the volatility of public expenditures. Two different empirical strategies are implemented using the per capita operating expenditures of 90 French local jurisdictions (the départements) for an 8-year period. The first strategy focuses directly on the impact of the electoral margin, the fragmentation of the majority and the concentration of the opposition on the annual budget growth rates. The second strategy regresses the present expenditures on last year's expenditures over several subsamples. Both empirical strategies lead to the following conclusions. First, the less powerful a majority in terms of seats and fragmentation, the lower the annual fluctuations of the budget. Second, highly powerful majorities are not always associated with the highest budgetary growth rates.
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  • Benoît Le Maux & Wenjia Zhang, 2013. "Does political fragmentation lead to budgetary incrementalism? An empirical test on the French local public sector," Papers in Regional Science, Wiley Blackwell, vol. 92(3), pages 535-553, August.
    • Handle: RePEc:bla:presci:v:92:y:2013:i:3:p:535-553
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    File URL: http://hdl.handle.net/10.1111/pirs.2013.92.issue-3
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    Cited by:

    1. Fabio Padovano, 2014. "Distribution of transfers and soft budget spending behaviors: evidence from Italian regions," Public Choice, Springer, vol. 161(1), pages 11-29, October.
    2. Jean-Michel Josselin & Fabio Padovano & Yvon Rocaboy, 2013. "Grant legislation vs. political factors as determinants of soft budget spending behaviors. Comparison between Italian and French regions," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 10(3), pages 317-354, December.

    More about this item

    JEL classification:

    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures

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