Sources of inefficiency in representative democracy: Evidence on public investments across nations
AbstractBesley and Coate (1997 and 1998) exposit a formal model of dynamic fiscal policy that highlights the problem associated with the temporal mismatch between the incidence of benefits and costs. Their analysis focuses in part on the conditions that may result in inefficient public investment decisions in a representative democracy. This paper employs cross-national data to investigate implications of the Besley-Coate model. The findings indicate that several political institutions significantly affect public investments, including term lengths, staggered term expiration dates, and the separation of power between the executive and legislative branches. The findings also suggest that fiscal arrangements for redistributive payments may increase public investments. Copyright Springer-Verlag Berlin Heidelberg 2002
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Bibliographic InfoArticle provided by Springer in its journal Economics of Governance.
Volume (Year): 3 (2002)
Issue (Month): 2 (07)
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Web page: http://link.springer.de/link/service/journals/10101/index.htm
Find related papers by JEL classification:
- H1 - Public Economics - - Structure and Scope of Government
- H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
- H87 - Public Economics - - Miscellaneous Issues - - - International Fiscal Issues; International Public Goods
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