Public Spending Interactions and Local Politics: Empirical Evidence from French Municipalities

Posted: 18 Nov 2008

See all articles by Martial Foucault

Martial Foucault

University of Montreal; Center for Interuniversity Research and Analysis on Organization (CIRANO)

Thierry Madies

Université d'Évry - Centre D'Etudes des Politiques Economiques et de L'Emploi (EPEE); Université Paris I Panthéon-Sorbonne - Laboratoire d'Economie Publique (LAEP)

Sonia Paty

University of Angers - Institute of Economic Theory and Analysis (GATE)

Date Written: September 18, 2008

Abstract

This paper aims at testing whether there exist spending interactions between French municipalities by estimating a dynamic panel data model. Our results suggest that there are some interactions between neighbouring municipalities as regards primary and investment expenditures. A positive relationship between municipalities' wage bill and unemployment rates is likely to stress a rise of temporary employment in those municipalities that suffer from social troubles. Further, the estimation results show that these interdependences also exist between cities whose mayors have the same partisan affiliation. Finally, our results confirm the opportunistic behaviour of local governments, which increase all categories of public spending in pre-electoral periods.

Keywords: Spending interactions,France, Local government, Dynamic panel data

JEL Classification: D72, H2, H7

Suggested Citation

Foucault, Martial and Madies, Thierry and Paty, Sonia, Public Spending Interactions and Local Politics: Empirical Evidence from French Municipalities (September 18, 2008). Available at SSRN: https://ssrn.com/abstract=1303527

Martial Foucault (Contact Author)

University of Montreal ( email )

Political Science Department
C.P. 6128 succursale Centre-ville
Montreal, Quebec H3T 1B9, Quebec H3C 3J7
Canada

Center for Interuniversity Research and Analysis on Organization (CIRANO)

2020 rue University, 25th floor
Montreal H3C 3J7, Quebec
Canada

Thierry Madies

Université d'Évry - Centre D'Etudes des Politiques Economiques et de L'Emploi (EPEE)

Boulevard Francois Mitterrand
F-91025 Evry Cedex
France

Université Paris I Panthéon-Sorbonne - Laboratoire d'Economie Publique (LAEP)

106 -112 boulevard de l'Hopital
Paris Cedex 13, 75 647
France

Sonia Paty

University of Angers - Institute of Economic Theory and Analysis (GATE) ( email )

93, chemin des Mouilles
Monnaie et Finance at Lyon
69130 Ecully cedex
France

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
224
PlumX Metrics