Public Preferences for Government Spending Priorities: Survey Evidence from Germany

32 Pages Posted: 12 Dec 2014 Last revised: 14 Dec 2014

See all articles by Bernd Hayo

Bernd Hayo

University of Marburg - School of Business & Economics

Florian Neumeier

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute

Date Written: November 4, 2014

Abstract

Employing data from a representative survey conducted in Germany, this paper examines public preferences for the size and composition of government expenditure. We focus on public attitudes toward taxes, public debt incurrence, and public spending in six different policy areas. Our findings suggest, first, that the current scope of government is supported by a majority of the German population. Second, we find that individual preferences for the composition of government spending differ along various dimensions. Specifically, personal economic wellbeing, economic literacy, confidence in politicians, political ideology, and time preference are significantly related to individual attitudes toward public spending, taxes, and debt. The magnitude of the effects is particularly large for time preference, economic knowledge, and party preference. Third, public preferences for public spending priorities are only marginally affected when considering a public budget constraint.

Keywords: Public spending, public preferences, public debt, taxes, survey, Germany

JEL Classification: E62, H11, H50, H63

Suggested Citation

Hayo, Bernd and Neumeier, Florian, Public Preferences for Government Spending Priorities: Survey Evidence from Germany (November 4, 2014). Available at SSRN: https://ssrn.com/abstract=2536912 or http://dx.doi.org/10.2139/ssrn.2536912

Bernd Hayo

University of Marburg - School of Business & Economics ( email )

Universitaetsstr. 24
Marburg, D-35032
Germany
++49(0)6421-28-23091 (Phone)
++49(0)6421-28-23193 (Fax)

Florian Neumeier (Contact Author)

CESifo (Center for Economic Studies and Ifo Institute) - Ifo Institute ( email )

Poschinger Str. 5
Munich, 01069
Germany

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