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Divided We Fall. Conflicts of Interests Regarding Fiscal Discipline in Municipal Hierarchies

Persistent budget deficits are commonly blamed on irresponsible governments. However, even if the government is fiscally responsible, the agents in charge of implementing the budget may be less concerned about fiscal discipline. According to the survey data analyzed in this paper, such conflicts of interests are associated with low fiscal performance and prevail in almost half of the Swedish municipalities. The empirical analysis points at some organizational features that may affect the prevalence of conflicts, and also indicates that conflicts may arise for reasons exogenous to the organization.

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File URL: http://project.nek.lu.se/publications/workpap/papers/WP13_42.pdf
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Paper provided by Lund University, Department of Economics in its series Working Papers with number 2013:42.

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Length: 24 pages
Date of creation: 04 Dec 2013
Date of revision:
Handle: RePEc:hhs:lunewp:2013_042
Contact details of provider: Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund,Sweden
Phone: +46 +46 222 0000
Fax: +46 +46 2224613
Web page: http://www.nek.lu.se/en

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  13. Dietrichson, Jens & Ellegård, Lina Maria, 2011. "Institutions promoting budgetary discipline: evidence from Swedish municipalities," Working Papers 2011:8, Lund University, Department of Economics, revised 20 Dec 2012.
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  17. Ashoka Mody & Stefania Fabrizio, 2008. "Breaking the Impediments to Budgetary Reforms; Evidence From Europe," IMF Working Papers 08/82, International Monetary Fund.
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