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The Political Determinants of Federal Expenditure at the State Level

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  • Gary Hoover
  • Paul Pecorino

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Abstract

It has been shown that states with higher per capita senate representation have higher federal spending per capita (Atlas, C. M., Gilligan, T. A., Hendershott, R. J. and Zupan, M. A. (1995). American Economic Review 85: 624–629). With a more recent data sample, more highly disaggregated data and a different set of political control variables, we are able to confirm the main result of Atlas et al. that per capita senate representation is positively related to federal expenditure. This effect is strongest for procurement expenditures. By contrast, we do not find support for their result that spending increases with per capita representation in the House of Representatives. Several other political variables are found to be significant in a subset of the expenditure equations. Copyright Springer Science + Business Media, Inc. 2005

Suggested Citation

  • Gary Hoover & Paul Pecorino, 2005. "The Political Determinants of Federal Expenditure at the State Level," Public Choice, Springer, vol. 123(1), pages 95-113, April.
  • Handle: RePEc:kap:pubcho:v:123:y:2005:i:1:p:95-113
    DOI: 10.1007/s11127-005-7524-z
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    References listed on IDEAS

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    1. Levitt, Steven D & Poterba, James M, 1999. "Congressional Distributive Politics and State Economic Performance," Public Choice, Springer, vol. 99(1-2), pages 185-216, April.
    2. Marilyn Young & Michael Reksulak & William F. Shughart, 2001. "The Political Economy of the IRS," Economics and Politics, Wiley Blackwell, vol. 13(2), pages 201-220, July.
    3. Brian Knight, 2004. "Legislative Representation, Bargaining Power, and the Distribution of Federal Funds: Evidence from the U.S. Senate," NBER Working Papers 10385, National Bureau of Economic Research, Inc.
    4. Wright, Gavin, 1974. "The Political Economy of New Deal Spending: An Econometric Analysis," The Review of Economics and Statistics, MIT Press, vol. 56(1), pages 30-38, February.
    5. Fleck, Robert K, 1999. "The Value of the Vote: A Model and Test of the Effects of Turnout on Distributive Policy," Economic Inquiry, Western Economic Association International, vol. 37(4), pages 609-623, October.
    6. Anderson, Gary M & Tollison, Robert D, 1991. "Congressional Influence and Patterns of New Deal Spending, 1933-1939," Journal of Law and Economics, University of Chicago Press, vol. 34(1), pages 161-175, April.
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    1. Is there a small-state effect?
      by Economic Logician in Economic Logic on 2013-12-30 22:17:00

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    Cited by:

    1. Hans Pitlik & Friedrich Schneider & Harald Strotmann, 2006. "Legislative Malapportionment and the Politicization of Germany's Intergovernmental Transfer System," Public Finance Review, , vol. 34(6), pages 637-662, November.
    2. Tiberiu Dragu & Jonathan Rodden, 2010. "Representation and regional redistribution in federations," Working Papers 2010/16, Institut d'Economia de Barcelona (IEB).
    3. Stratford Douglas & W. Robert Reed, 2013. "A Replication of "The Political Determinants of Federal Expenditure at the State Level (Public Choice, 2005)," Working Papers in Economics 13/31, University of Canterbury, Department of Economics and Finance.
    4. Alexander Fink & Thomas Stratmann, 2009. "Institutionalized Bailouts and Fiscal Policy: The Consequences of Soft Budget Constraints," CESifo Working Paper Series 2827, CESifo Group Munich.
    5. Roy Howsen & Stephen Lile, 2011. "The role of politics and economics in the allocation of federal stimulus spending," Applied Economics Letters, Taylor & Francis Journals, vol. 18(3), pages 263-266.
    6. Valentino Larcinese & Leonzio Rizzo & Cecilia Testa, 2013. "Why Do Small States Receive More Federal Money? U.S. Senate Representation and the Allocation of Federal Budget," Economics and Politics, Wiley Blackwell, vol. 25(3), pages 257-282, November.
    7. Valentino Larcinese & Leonzio Rizzo & Cecilia Testa, 2007. "Do Small States Get More Federal Monies? Myth and Reality about the US Senate Malapportionment," Royal Holloway, University of London: Discussion Papers in Economics 07/01, Department of Economics, Royal Holloway University of London, revised May 2007.
    8. Alberto Porto, 2013. "Determinantes de la distribución regional de los gastos públicos. Un caso de estudio," Department of Economics, Working Papers 102, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata.
    9. Lauren Cohen & Joshua D. Coval & Christopher Malloy, 2010. "Do Powerful Politicians Cause Corporate Downsizing?," NBER Working Papers 15839, National Bureau of Economic Research, Inc.
    10. repec:spr:ecogov:v:18:y:2017:i:4:d:10.1007_s10101-017-0196-6 is not listed on IDEAS
    11. Owyang, Michael T. & Zubairy, Sarah, 2013. "Who benefits from increased government spending? A state-level analysis," Regional Science and Urban Economics, Elsevier, vol. 43(3), pages 445-464.
    12. Stratford Douglas & W. Robert Reed, 2013. "REPLICATION STUDY: Hoover and Pecorino (Public Choice, 2005)," Working Papers in Economics 13/11, University of Canterbury, Department of Economics and Finance.
    13. Viktor Slavtchev & Simon Wiederhold, 2011. "The Impact of Government Procurement Composition on Private R&D Activities," Jena Economic Research Papers 2011-036, Friedrich-Schiller-University Jena.
    14. Simon Wiederhold, 2012. "The Role of Public Procurement in Innovation: Theory and Empirical Evidence," ifo Beiträge zur Wirtschaftsforschung, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, number 43.
    15. repec:eee:ecotra:v:13:y:2018:i:c:p:27-35 is not listed on IDEAS
    16. repec:kap:pubcho:v:171:y:2017:i:1:d:10.1007_s11127-017-0435-y is not listed on IDEAS

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