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Public Preferences for Government Spending Priorities: Survey Evidence from Germany

Author

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  • Bernd Hayo
  • Florian Neumeier

Abstract

Employing data from a representative survey conducted in Germany, this paper examines public preferences for the size and composition of government expenditure. We focus on public attitudes towards taxes, public debt incurrence and public spending in six different policy areas. Our findings suggest, first, that individual preferences for the use of additional tax money can be categorised as either capital‐oriented expenditure or public debt reduction. Second, we find that fiscal preferences differ along various dimensions. Specifically, personal economic well‐being, economic literacy, confidence in politicians, political ideology and time preference are significantly related to individual attitudes towards public spending, taxes and debt. The magnitude of the effects is particularly large for time preference, economic knowledge and party preference. Third, public preferences for public spending priorities are only marginally affected when considering a public budget constraint.

Suggested Citation

  • Bernd Hayo & Florian Neumeier, 2019. "Public Preferences for Government Spending Priorities: Survey Evidence from Germany," German Economic Review, Verein für Socialpolitik, vol. 20(4), pages 1-37, November.
  • Handle: RePEc:bla:germec:v:20:y:2019:i:4:p:e1-e37
    DOI: 10.1111/geer.12149
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    Cited by:

    1. Massimo Bordignon & Nicolò Gatti & Gilberto Turati, 2025. "Are Citizens Willing to Reduce Public Debt? Beliefs, Information and Policy Preferences," CESifo Working Paper Series 12013, CESifo.
    2. Jan Behringer & Lena Draeger & Sebastian Dullien & Sebastian Gechert, 2024. "News and Views on Public Finances: A Survey Experiment," FMM Working Paper 97-2024, IMK at the Hans Boeckler Foundation, Macroeconomic Policy Institute.
    3. Israel García, 2023. "Budget Forecast Errors in Spanish Municipalities: The Role of Transparency," MAGKS Papers on Economics 202327, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    4. Markus Eller & Branimir Jovanovic & Thomas Scheiber, 2021. "What do people in CESEE think about public debt?," Focus on European Economic Integration, Oesterreichische Nationalbank (Austrian Central Bank), issue Q3/21, pages 35-58.
    5. Israel García & Bernd Hayo, 2023. "Fiscal Reform in Spanish Municipalities: Gender Differences in Budgetary Adjustment," CESifo Working Paper Series 10297, CESifo.
    6. Armin A. Bolouri & Tim Lohse & Salmai Qari, 2025. "Interdependent Preferences for Financing and Providing Public Goods—The Case of National Defense," Kyklos, Wiley Blackwell, vol. 78(3), pages 807-821, August.

    More about this item

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • H63 - Public Economics - - National Budget, Deficit, and Debt - - - Debt; Debt Management; Sovereign Debt

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