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Two approaches to estimating public expenditures

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  • Pommerehne, Werner
  • Frey, Bruno S.

Abstract

Traditionally, the demand for public expenditures has been estimated using as explanatory variables the average values of per capita income, as well as other variables. The results of this approach are disappointing which is due to the lacking theoretical basis. The public choice model, on the other hand, uses the political decision-making process (median voter model) to explain expenditures. Taking the same set of data, it is shown that the public choice approach yields superior results. It also offers a solution to the unfruitful discussion about the influence of political determinants of public expenditures.

Suggested Citation

  • Pommerehne, Werner & Frey, Bruno S., 1975. "Two approaches to estimating public expenditures," Discussion Papers, Series I 65, University of Konstanz, Department of Economics.
  • Handle: RePEc:zbw:kondp1:65
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    Cited by:

    1. Montmarquette, Claude, 1988. "Le marché politique : qu’est-ce qui est produit? Qui y participe? Qui en profite?," L'Actualité Economique, Société Canadienne de Science Economique, vol. 64(3), pages 336-360, septembre.
    2. José Manuel Cruz, 2004. "Empirical analysis of the influence of voters and politicians in the public choice of Portuguese municipalities universidade portucalense," ERSA conference papers ersa04p367, European Regional Science Association.
    3. Rhee, Se-Koo, 1996. "The impact of intergovernmental grants-in-aid on public school expenditure under the segregated school system," ISU General Staff Papers 1996010108000012396, Iowa State University, Department of Economics.
    4. Marie-Estelle Binet & Jean-Sébastien Pentecote, 2003. "Tax shape, debt and electoral opportunism at the municipal level: French empirical evidence and a model (?)," ERSA conference papers ersa03p28, European Regional Science Association.
    5. George Boyne, 1987. "Median voters, political systems and public policies: An empirical test," Public Choice, Springer, vol. 53(3), pages 201-219, January.
    6. Bruno S. Frey & Lasse Steiner, 2012. "Political Economy: Success or Failure?," Contemporary Economics, University of Finance and Management in Warsaw, vol. 6(3), September.
    7. Paul Wyckoff, 1989. "Bureaucracy and the ‘publicness’ of local public goods: A reply to Gonzalez, Folsom and Mehay," Public Choice, Springer, vol. 62(1), pages 79-82, July.
    8. Alois Stutzer & Lukas Kienast, 2005. "Demokratische Beteiligung und Staatsausgaben: Die Auswirkungen des Frauenstimmrechts," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 141(IV), pages 617-650, December.
    9. Sarani Saha, 2011. "City-level analysis of the effect of political regimes on public good provision," Public Choice, Springer, vol. 147(1), pages 155-171, April.
    10. Carolin Fritzsche, 2018. "Analyzing the Efficiency of County Road Provision - Evidence from Eastern German Counties," ifo Working Paper Series 249, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    11. Eric J. Brunner & Stephen L. Ross, 2007. "How Decisive Is the Decisive Voter?," Working papers 2007-28, University of Connecticut, Department of Economics, revised Aug 2008.
    12. Clemens Fuest & Bernd Huber, 2001. "Tax Competition and Tax Coordination in a Median Voter Model," Public Choice, Springer, vol. 107(1), pages 97-113, April.
    13. repec:ces:ifodre:v:16:y:2009:i:05:p:s.13-20 is not listed on IDEAS
    14. Randall Holcombe, 1989. "The median voter model in public choice theory," Public Choice, Springer, vol. 61(2), pages 115-125, May.
    15. Marc Baudry & Matthieu Leprince & Cyriaque Moreau, 2002. "Préférences révélées, bien public local et électeur médian : tests sur données françaises," Économie et Prévision, Programme National Persée, vol. 156(5), pages 125-146.
    16. Arthur Schram & Frans Winden, 1989. "Revealed preferences for public goods: Applying a model of voter behavior," Public Choice, Springer, vol. 60(3), pages 259-282, March.
    17. Lars P. Feld & Gebhard Kirchgaessner & Christoph A. Schaltegger, 2010. "Decentralized Taxation and the Size of Government: Evidence from Swiss State and Local Governments," Southern Economic Journal, Southern Economic Association, vol. 77(1), pages 27-48, July.
    18. Brunner, Eric J. & Ross, Stephen L., 2010. "Is the median voter decisive? Evidence from referenda voting patterns," Journal of Public Economics, Elsevier, vol. 94(11-12), pages 898-910, December.
    19. Rodney Fort, 1988. "The median voter, setters, and non-repeated construction bond issues," Public Choice, Springer, vol. 56(3), pages 213-231, March.
    20. Filip Palda, 2002. "Interest Groups: An Introduction," Public Economics 0209006, EconWPA.
    21. Benoît Le Maux, 2009. "How Do Policy-Makers Actually Solve Problems? Evidence From The French Local Public Sector," Economics and Politics, Wiley Blackwell, vol. 21(2), pages 201-231, July.
    22. Lars Feld & Christoph Schaltegger, 2010. "Political stability and fiscal policy: time series evidence for the Swiss federal level since 1849," Public Choice, Springer, vol. 144(3), pages 505-534, September.
    23. Blankart, Charles B., 1975. "Neuere Ansätze zur Erklärung des Wachstums der Staatsausgaben: Ein interpretierender Überblick," Discussion Papers, Series I 67, University of Konstanz, Department of Economics.
    24. Cruz, Jose Manuel, 2002. "Who is fitting better to Portuguese local demand for public choice: Central government or municipal governments?," ERSA conference papers ersa02p440, European Regional Science Association.
    25. José Cruz, 2001. "An empirical application of the median voter model and of the interest group influence model to the Portuguese and Galician municipalities," ERSA conference papers ersa01p25, European Regional Science Association.

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