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Government Form and Public Spending: Theory and Evidence from U.S. Municipalities

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Stephen Coate
Brian Knight

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Abstract

There are two main forms of government in U.S. cities: council-manager and mayor-council. This paper develops a theory of fiscal policy determination under these two forms. The theory predicts that expected public spending will be lower under mayor-council, but that either form of government could be favored by a majority of citizens. The latter prediction means that the theory is consistent with the co-existence of both government forms. Support for the former prediction is found in both a cross-sectional analysis and a panel analysis of changes in government form.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 14857.

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Date of creation: Apr 2009
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Handle: RePEc:nbr:nberwo:14857

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Find related papers by JEL classification:
D7 - Microeconomics - - Analysis of Collective Decision-Making
H7 - Public Economics - - State and Local Government; Intergovernmental Relations

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  1. Reza Baqir, 2002. "Districting and Government Overspending," Journal of Political Economy, University of Chicago Press, vol. 110(6), pages 1318-1354, December. [Downloadable!] (restricted)
  2. Persson, Torsten & Tabellini, Guido, 2006. "Democracy and Development: The Devil in the Details," CEPR Discussion Papers 5499, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  3. Alberto Alesina & Guido Tabellini, 2007. "Bureaucrats or Politicians? Part I: A Single Policy Task," American Economic Review, American Economic Association, vol. 97(1), pages 169-179, March. [Downloadable!]
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  4. Jonathan Levin & Steven Tadelis, 2007. "Contracting for Government Services: Theory and Evidence from U.S. Cities," NBER Working Papers 13350, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  5. Persson, Torsten & Roland, Gerard & Tabellini, Guido, 1997. "Separation of Powers and Political Accountability," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1163-1202, November.
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  6. Farnham, Paul G, 1990. " The Impact of Citizen Influence on Local Government Expenditure," Public Choice, Springer, vol. 64(3), pages 201-12, March.
  7. 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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  8. Timothy Besley & Stephen Coate, 2003. "Elected Versus Appointed Regulators: Theory and Evidence," Journal of the European Economic Association, MIT Press, vol. 1(5), pages 1176-1206, 09. [Downloadable!] (restricted)
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  9. Sass, Tim R, 1991. " The Choice of Municipal Government Structure and Public Expenditures," Public Choice, Springer, vol. 71(1-2), pages 71-87, August.
  10. Lynn MacDonald, 2008. "The impact of government structure on local public expenditures," Public Choice, Springer, vol. 136(3), pages 457-473, September. [Downloadable!] (restricted)
  11. Eric Maskin & Jean Tirole, 2004. "The Politician and the Judge: Accountability in Government," American Economic Review, American Economic Association, vol. 94(4), pages 1034-1054, September. [Downloadable!]
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  12. Ehrenberg, Ronald G. & Goldstein, Gerald S., 1975. "A model of public sector wage determination," Journal of Urban Economics, Elsevier, vol. 2(3), pages 223-245, July. [Downloadable!] (restricted)
  13. Francesco Trebbi & Philippe Aghion & Alberto Alesina, 2008. "Electoral Rules and Minority Representation in U.S. Cities," The Quarterly Journal of Economics, MIT Press, vol. 123(1), pages 325-357, 02. [Downloadable!] (restricted)
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