I test if parties matter with respect to the allocation of public expenditures in Germany. Considering the allocation of rights and duties due to the federal structure, two econometric models are estimated. First, a SURE model analyses spending at the federal level for the period from 1950 to 2003 and finds evidence for partisan politics and election year effects. Second, I examine the spending behaviour in the states from 1974 to 2004 in a panel data framework. In comparison to the federal level, policy has weaker impacts on the allocation of expenditures in the states.
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Paper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number
652.
Find related papers by JEL classification: D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Models of Political Processes: Rent-seeking, Elections, Legislatures, and Voting Behavior H50 - Public Economics - - National Government Expenditures and Related Policies - - - General H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
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