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Is There an Election Cycle in Public Employment? Separating Time Effects from Election Year Effects

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  • Dahlberg, Matz
  • Mörk, Eva

Abstract

Do governments increase public employment in election years? This paper investigates this question by using data from Sweden and Finland, two countries that are similar in many respects but in which local elections are held at different points in time. We can thereby separate an election effect from other time effects. Our results indicate that there is a statistically significant election year effect in local public employment, a production factor that is highly visible in the welfare services provided by the local governments in the Scandinavian countries. The effect also seems to be economically significant; the municipalities employ 0.6 more full-time employees per 1,000 capita in election years than in other years (which correspond to an increase by approximately 1 percent). JEL-codes: D72, H72, P16

Suggested Citation

  • Dahlberg, Matz & Mörk, Eva, 2008. "Is There an Election Cycle in Public Employment? Separating Time Effects from Election Year Effects," Discussion Papers 444, VATT Institute for Economic Research.
  • Handle: RePEc:fer:dpaper:444
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    Keywords

    Election cycle; Public employment; Exogenous elections; International comparisons; Kansainväliset vertailut; Labour market; Työmarkkinat; Local public economics; Kunnallistalous; Public services; Julkiset palvelut; Effectiveness of public services; Julkisten palvelujen vaikuttavuus;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism

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