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The Timing of Elections in Federations : A Disciplining Device against Soft Budget Constraints ?

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Abstract

We introduce political economics into the soft budget constraint problem by asking if the timing of elections has the potential to harden budget constraints. Specifically, we ask under which circumstances the soft budget constraint problem is worse - with synchronized elections, i.e. simultaneous central and regional office terms, or with staggered elections, i.e. terms of office that do not coincide. We find that staggered elections clearly improve fiscal discipline at the local level as well as welfare.

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File URL: ftp://mse.univ-paris1.fr/pub/mse/CES2010/10036.pdf
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Bibliographic Info

Paper provided by Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne in its series Documents de travail du Centre d'Economie de la Sorbonne with number 10036.

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Length: 25 pages
Date of creation: Feb 2010
Date of revision:
Handle: RePEc:mse:cesdoc:10036

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Keywords: Soft budget constraints; fiscal federalism; elections.;

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Cited by:
  1. Baskaran, Thushyanthan, 2013. "Do bailouts buy votes? Evidence from a panel of Hessian municipalities," MPRA Paper 48228, University Library of Munich, Germany.

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