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Political cycles in public expenditure: butter vs guns

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  • Bove, Vincenzo
  • Efthyvoulou, Georgios
  • Navas, Antonio

Abstract

This paper explores, theoretically and empirically, how governments may use the tradeoff between social and military expenditure to advance their electoral and partisan objectives. Three key results emerge. First, governments tend to bias outlays towards social expenditure and away from military expenditure at election times. Second, the size of this tradeoff is larger when we exclude countries involved in conflict, where national security plays an important role on voter choice. Third, while certain categories of social expenditure are higher during left administrations, military expenditure is higher during right administrations.

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  • Bove, Vincenzo & Efthyvoulou, Georgios & Navas, Antonio, 2017. "Political cycles in public expenditure: butter vs guns," Journal of Comparative Economics, Elsevier, vol. 45(3), pages 582-604.
  • Handle: RePEc:eee:jcecon:v:45:y:2017:i:3:p:582-604
    DOI: 10.1016/j.jce.2016.03.004
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    Cited by:

    1. Niklas Potrafke, 2019. "The globalisation–welfare state nexus: Evidence from Asia," The World Economy, Wiley Blackwell, vol. 42(3), pages 959-974, March.
    2. Niklas Potrafke, 2019. "Dragnet-controls and government ideology," ifo Working Paper Series 288, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    3. Georgios Magkonis & Vasileios Logothetis & Kalliopi-Maria Zekente, 2019. "Does the Left Spend More?," Working Papers in Economics & Finance 2019-03, University of Portsmouth, Portsmouth Business School, Economics and Finance Subject Group.
    4. Lenka Maličká, 2019. "Political Expenditure Cycle at the Municipal Government Level in Slovakia," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 67(2), pages 503-513.
    5. Gupta, Sanjeev & Liu, Estelle X. & Mulas-Granados, Carlos, 2016. "Now or later? The political economy of public investment in democracies," European Journal of Political Economy, Elsevier, vol. 45(C), pages 101-114.
    6. Antoine CAZALS & Pierre MANDON, 2016. "Political Budget Cycles: Manipulation from Leaders or Manipulation from Researchers? Evidence from a Meta-Regression Analysis," Working Papers 201609, CERDI.
    7. Langlotz, Sarah & Potrafke, Niklas, 2019. "Does development aid increase military expenditure?," Journal of Comparative Economics, Elsevier, vol. 47(3), pages 735-757.
    8. Adam, Antonis & Ftergioti, Stamatia, 2019. "Neighbors and friends: How do European political parties respond to globalization?," European Journal of Political Economy, Elsevier, vol. 59(C), pages 369-384.
    9. Björn Kauder & Manuela Krause & Niklas Potrafke, 2018. "Electoral cycles in MPs’ salaries: evidence from the German states," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 25(4), pages 981-1000, August.
    10. Johannes Blum & Niklas Potrafke, 2019. "Internationale Abkommen und Regierungswechsel: Evidenz zum NATO-Zwei-Prozent-Ziel," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 72(03), pages 18-21, February.
    11. Xi, Tianyang & Yao, Yang & Zhang, Muyang, 2018. "Capability and opportunism: Evidence from city officials in China," Journal of Comparative Economics, Elsevier, vol. 46(4), pages 1046-1061.
    12. Oliver Pamp & Florian Dendorfer & Paul W. Thurner, 2018. "Arm your friends and save on defense? The impact of arms exports on military expenditures," Public Choice, Springer, vol. 177(1), pages 165-187, October.
    13. Niklas Potrafke, 2016. "Partisan Politics: The Empirical Evidence from OECD Panel Studies," CESifo Working Paper Series 6024, CESifo Group Munich.
    14. Linda G. Veiga & Georgios Efthyvoulou & Atsuyoshi Morozumi, 2018. "Political Budget Cycles: Conditioning Factors and New Evidence," NIPE Working Papers 21/2018, NIPE - Universidade do Minho.
    15. Khani Hoolari, Seyed Morteza & Taghinejad Omran, Vahid, 2017. "Natural Budget Deficit and Natural Political Cyclicality," MPRA Paper 78107, University Library of Munich, Germany.
    16. Antoine Cazals & Pierre Mandon, 2015. "Political Budget Cycles: Manipulation of Leaders or Bias from Research? A Meta-Regression Analysis," Working Papers halshs-01238883, HAL.
    17. Johannes Blum & Niklas Potrafke, 2019. "Does a Change of Government Influence Compliance with International Agreements? Empirical Evidence for the NATO Two Percent Target," ifo Working Paper Series 290, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    18. Niklas Potrafke, 2019. "Dragnet-controls and government ideology," ifo Working Paper Series 288, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    19. Sanjay Patnaik, 2019. "A cross-country study of collective political strategy: Greenhouse gas regulations in the European Union," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(7), pages 1130-1155, September.
    20. Antoine Cazals & Pierre Mandon, 2016. "Political Budget Cycles: Manipulation from Leaders or Manipulation from Researchers? Evidence from a Meta-Regression Analysis," Working Papers halshs-01320586, HAL.
    21. Bove, Vincenzo & Elia, Leandro & Ferraresi, Massimiliano, 2019. "Immigration, fear of crime and public spending on security," CAGE Online Working Paper Series 434, Competitive Advantage in the Global Economy (CAGE).
    22. Niklas Potrafke, 2014. "The Evidence on Globalization," CESifo Working Paper Series 4708, CESifo Group Munich.
    23. Sanjeev Gupta & Estelle X Liu & Carlos Mulas-Granados, 2015. "Now or Later? The Political Economy of Public Investment in Democracies," IMF Working Papers 15/175, International Monetary Fund.

    More about this item

    Keywords

    Elections; Partisanship; Social expenditure; Military expenditure;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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