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Do large cabinets favor large governments? Evidence on the fiscal commons problem for Swiss Cantons

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  • Schaltegger, Christoph A.
  • Feld, Lars P.

Abstract

The fiscal commons problem is one of the most prominent explanations of excessive spending in political economics. For a panel of the 26 Swiss cantons over the 1980-1998 periods, this paper explores the role of fragmented governments on fiscal policy outcomes. We distinguish between two variants of fragmented governments: cabinet size and coalition size. In addition, we analyze whether constitutional rules for executive and legislature as well as formal fiscal restraints shape the size of government and how different rules interact with fragmentation. The results indicate that the number of ministers in the cabinet is positively associated with the size of government. While fiscal referendums effectively restrict the size of government, there is also evidence that fiscal referendums relax the fiscal commons problem to some extent.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Public Economics.

Volume (Year): 93 (2009)
Issue (Month): 1-2 (February)
Pages: 35-47

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Handle: RePEc:eee:pubeco:v:93:y:2009:i:1-2:p:35-47

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Web page: http://www.elsevier.com/locate/inca/505578

Related research

Keywords: Fragmentation Fiscal policy Referendums Legislative rules Formal fiscal restraints;

References

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  4. Christoph A. Schaltegger & Lars P. Feld, 2008. "Do Large Cabinets Favor Large Governments? Evidence on Institutional Restraints on the Fiscal Commons Problem for Swiss Cantons," CREMA Working Paper Series 2008-10, Center for Research in Economics, Management and the Arts (CREMA).
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  14. Volkerink, Bjorn & De Haan, Jakob, 2001. " Fragmented Government Effects on Fiscal Policy: New Evidence," Public Choice, Springer, vol. 109(3-4), pages 221-42, December.
  15. Besley, Timothy & Case, Anne, 1995. "Does Electoral Accountability Affect Economic Policy Choices? Evidence from Gubernatorial Term Limits," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 769-98, August.
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