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Social spending and democracy: some evidence from South America

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Author Info
Casey B.Mulligan
Ricard Gil

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Abstract

Social spending programs are important political issues, and it would be interesting to know how political systems affect the amount spent by the public sector. Much of the cross-country data is difficult to interpret, because richer countries simultaneously have different political systems (they tend to be more democratic) and more generous government budgets for old age, medical, and other social programs. Since South American countries seem to have a much weaker association between economic and political situations, we can mitigate this collinearity by comparing South American countries with each other and with the world. All of our data show that democracies spend the same or somewhat less on social programs as economically and demographically similar nondemocracies. Pension spending has grown relative to nonpension social spending (1960-90), but some of our evidence suggests that this change in the composition of spending has been more pronounced in countries that were initially nondemocratic.

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File URL: http://econ.uchile.cl/public/Archivos/pub/3d3d63c6-9aea-4dde-8d58-42d03ce8f958.pdf
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Publisher Info
Article provided by University of Chile, Department of Economics in its journal Estudios de Economia.

Volume (Year): 29 (2002)
Issue (Month): 1 Year 2002 (June)
Pages: 5-33
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Handle: RePEc:udc:esteco:v:29:y:2002:i:1:p:5-33

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Related research
Keywords: Social programs; government budgets; System of government.;

Find related papers by JEL classification:
H1 - Public Economics - - Structure and Scope of Government
H50 - Public Economics - - National Government Expenditures and Related Policies - - - General

References listed on IDEAS
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  1. Casey B Mulligan, 1999. "Gerontocracy, Retirement, and Social Security," University of Chicago - George G. Stigler Center for Study of Economy and State 154, Chicago - Center for Study of Economy and State. [Downloadable!]
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  2. Barro, Robert J, 1979. "On the Determination of the Public Debt," Journal of Political Economy, University of Chicago Press, vol. 87(5), pages 940-71, October. [Downloadable!] (restricted)
  3. Easterly, William & Rebelo, Sergio, 1993. "Fiscal policy and economic growth: An empirical investigation," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 417-458, December. [Downloadable!] (restricted)
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  4. Thomas F. Cooley & Jorge Soares, 1999. "A Positive Theory of Social Security Based on Reputation," Journal of Political Economy, University of Chicago Press, vol. 107(1), pages 135-160, February. [Downloadable!] (restricted)
  5. Torsten Persson & Gerard Roland & Guido Tabellini, 2000. "Comparative Politics and Public Finance," Journal of Political Economy, University of Chicago Press, vol. 108(6), pages 1121-1161, December. [Downloadable!] (restricted)
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  6. Easterly, William & Levine, Ross, 1997. "Africa's Growth Tragedy: Policies and Ethnic Divisions," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1203-50, November.
    Other versions:
  7. Meltzer, Allan H & Richard, Scott F, 1981. "A Rational Theory of the Size of Government," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 914-27, October. [Downloadable!] (restricted)
  8. Laitner, John, 1988. "Bequests, Gifts, and Social Security," Review of Economic Studies, Blackwell Publishing, vol. 55(2), pages 275-99, April. [Downloadable!] (restricted)
  9. Lindert Peter H., 1994. "The Rise of Social Spending, 1880-1930," Explorations in Economic History, Elsevier, vol. 31(1), pages 1-37, January. [Downloadable!] (restricted)
  10. Becker, Gary S & Murphy, Kevin M, 1988. "The Family and the State," Journal of Law & Economics, University of Chicago Press, vol. 31(1), pages 1-18, April.
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  11. Sala-i-Martin, Xavier X, 1996. " A Positive Theory of Social Security," Journal of Economic Growth, Springer, vol. 1(2), pages 2a77-304, June.
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  12. Perotti, Roberto, 1996. " Growth, Income Distribution, and Democracy: What the Data Say," Journal of Economic Growth, Springer, vol. 1(2), pages 149-87, June.
  13. Alesina, Alberto & Dollar, David, 2000. " Who Gives Foreign Aid to Whom and Why?," Journal of Economic Growth, Springer, vol. 5(1), pages 33-63, March. [Downloadable!] (restricted)
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  14. Lindert, Peter H., 1996. "What Limits Social Spending?," Explorations in Economic History, Elsevier, vol. 33(1), pages 1-34, January. [Downloadable!] (restricted)
  15. Deininger, Klaus & Squire, Lyn, 1996. "A New Data Set Measuring Income Inequality," World Bank Economic Review, Oxford University Press, vol. 10(3), pages 565-91, September.
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