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Political Cycles in Public Expenditure: Butter vs Guns

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  • Vincenzo Bove

    (Department of Government, University of Essex)

  • Georgios Efthyvoulou

    (Department of Economics, University of Sheffield)

  • Antonio Navas

    (Department of Economics, University of Sheffield)

Abstract

This paper presents a theoretical model and empirical evidence from 22 OECD countries to highlight how governments may use the tradeoff between social and military expenditure to advance their electoral and partisan objectives. Three basic results emerge. First, governments tend to bias outlays towards social expenditure and away from military expenditure at election times. Second, the strength of this cycle is smaller 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.

Suggested Citation

  • Vincenzo Bove & Georgios Efthyvoulou & Antonio Navas, 2013. "Political Cycles in Public Expenditure: Butter vs Guns," Working Papers 2013016, The University of Sheffield, Department of Economics.
  • Handle: RePEc:shf:wpaper:2013016
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    More about this item

    Keywords

    elections; partisanship; social expenditure; military expenditure;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • 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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