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http://ssrn.com/abstract=392643
 
 

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Do Electoral Cycles Differ Across Political Systems?


Guido Tabellini


University of Bocconi - Innocenzo Gasparini Institute for Economic Research (IGIER); Centre for Economic Policy Research (CEPR); Center for Economic Studies and Ifo Institute for Economic Research (CESifo); Bocconi University - Department of Economics

Torsten Persson


Stockholm University - Institute for International Economic Studies (IIES); London School of Economics & Political Science (LSE); National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

March 2003

IGIER Working Paper No. 232

Abstract:     
Do fiscal policy variables - overall spending, revenue, deficits and welfare-state spending - display systematic patterns in the vicinity of elections? And do such electoral cycles differ among political systems? We investigate these questions in a data set encompassing sixty democracies from 1960-98. Without conditioning on the political system, we find that taxes are cut before elections, painful fiscal adjustments are postponed until after the elections, while welfare-state spending displays no electoral cycle. Our subsequent results show that the pre-election tax cuts is a universal phenomenon. The post-election fiscal adjustments (spending cuts, tax hikes and rises in surplus) are, however, only present in presidential democracies. Moreover, majoritarian electoral rules alone are associated with pre-electoral spending cuts, while proportional electoral rules are associated with expansions of welfare spending both before and after elections.

Number of Pages in PDF File: 24

Keywords: Elections, constitution, form of government, electoral rules, fiscal policy

JEL Classification: A10, H10

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Date posted: May 19, 2003  

Suggested Citation

Tabellini, Guido and Persson, Torsten, Do Electoral Cycles Differ Across Political Systems? (March 2003). IGIER Working Paper No. 232. Available at SSRN: http://ssrn.com/abstract=392643 or http://dx.doi.org/10.2139/ssrn.392643

Contact Information

Guido Tabellini (Contact Author)
University of Bocconi - Innocenzo Gasparini Institute for Economic Research (IGIER) ( email )
Via Roentgen 1
Milan, 20136
Italy
+39 02 5836 3305 (Phone)
+39 02 5836 3302 (Fax)
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Center for Economic Studies and Ifo Institute for Economic Research (CESifo)
Poschinger Str. 5
Munich, DE-81679
Germany
HOME PAGE: http://www.CESifo.de
Bocconi University - Department of Economics ( email )
Via Gobbi 5
Milan, 20136
Italy
Torsten Persson
Stockholm University - Institute for International Economic Studies (IIES) ( email )
Stockholm University
10691 Stockholm, SE-10691
Sweden
+46 8 163066 (Phone)
+46 8 164177 (Fax)
London School of Economics & Political Science (LSE)
Houghton Street
London, WC2A 2AE
United Kingdom
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
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