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Do personal characteristics of finance ministers affect the development of public debt?

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  • Moessinger, Marc-Daniel

Abstract

Using a unique dataset of personal characteristics of national finance ministers in Europe (1980 - 2010), I show that especially a finance minister's experience affects the development of public debt. Both a finance minister's experience gained in office and his political experience have an impact: The change of the debt to GDP ratio is negative the more experience a finance minister has gained as a minister of finance or in former positions as a national cabinet member. While the former result suffers from potential endogeneity, several arguments support that the latter result can be interpreted in a causal way. In contrast, a finance minister's educational background or ideology have no significant impact on public debt changes. --

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Bibliographic Info

Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 12-068.

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Date of creation: 2012
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Handle: RePEc:zbw:zewdip:12068

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Keywords: public finance; public debt; finance minister; personal characteristics;

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Blog mentions

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  1. What can Governors do?
    by chris dillow in Stumbling and Mumbling on 2012-11-27 14:22:21
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Cited by:
  1. Florian Chatagny, 2013. "Incentive Effects of Fiscal Rules on the Finance Minister’s Behaviour: Evidence from Revenue Projections in Swiss Cantons," KOF Working papers 13-347, KOF Swiss Economic Institute, ETH Zurich.
  2. Heinemann, Friedrich & Janeba, Eckhard & Moessinger, Marc-Daniel & Schröder, Christoph, 2013. "Revenue autonomy preference in German state parliaments," ZEW Discussion Papers 13-090, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  3. António Afonso & Maria João Guedes, 2014. "EU Finance Ministers, Capital Markets and Fiscal Outcomes," Working Papers Department of Economics 2014/01, ISEG - School of Economics and Management, Department of Economics, University of Lisbon.

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