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Does legislative turnover adversely affect state expenditure policy? Evidence from Indian state elections

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Author Info
Uppal, Yogesh

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Abstract

I examine the effect of legislative turnover on the size and composition of government expenditures in Indian state elections during 1980-2000. The paper finds that excessive turnover in Indian state elections results in an inefficient government expenditure policy. First, the higher the turnover, the larger is the size of government. Second, excessive turnover affects the allocative efficiency of the government expenditure by skewing the composition of government spending towards pure consumption expenditure and away from more productive investment expenditure. The findings imply that a lack of a proper commitment mechanism in political markets could be a source of inefficiency in government policy.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 15657.

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Date of creation: 02 Jun 2009
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Handle: RePEc:pra:mprapa:15657

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Related research
Keywords: Legislative turnover; Indian elections; government spending;

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Find related papers by JEL classification:
E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
H7 - Public Economics - - State and Local Government; Intergovernmental Relations
H5 - Public Economics - - National Government Expenditures and Related Policies

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