Direct Democracy and Public Employees
38 Pages Posted: 30 May 2007
Date Written: May 2007
Abstract
In the public sector, employment may be inefficiently high because of patronage, and wages may be inefficiently high because of the strength of public employee interest groups. This paper explores whether the initiative process, a direct democracy institution of growing importance, can control these political economy problems, as proponents and some research suggests. Based on a sample of 500+ cities in 2000, I find that when public employees are allowed to bargain collectively, driving up wages, the initiative appears to cut wages by about 5 percent but has no measurable effect on employment. When public employees are not allowed to bargain collectively and patronage is a problem, initiatives appear to cut employment but not wages.
Keywords: Direct democracy, public employees, initiatives, unions
JEL Classification: H7, J45, D7
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Political Institutions and Policy Choices: Evidence from the United States
By Timothy J. Besley and Anne Case
-
Is There a Politically Optimal Level of Judicial Independence?
-
How Elections Matter: Theory and Evidence from Environmental Policy
By John A. List and Daniel M. Sturm
-
How Elections Matter: Theory and Evidence from Environmental Policy
By John A. List and Daniel M. Sturm
-
Issue Unbundling Via Citizens' Initiatives
By Timothy J. Besley and Stephen Coate
-
Issue Unbundling Via Citizens' Initiatives
By Timothy J. Besley and Stephen Coate
-
Political Competition and Economic Performance: Theory and Evidence from the United States
By Timothy J. Besley, Torsten Persson, ...
-
Political Competition and Economic Performance: Theory and Evidence from the United States
By Timothy J. Besley, Torsten Persson, ...
-
Political Competition and Economic Performance: Theory and Evidence from the United States
By Timothy J. Besley, Torsten Persson, ...
-
Political Competition with Campaign Contributions and Informative Advertising