The Fiscal Consequences of State Legislative Term Limits

37 Pages Posted: 27 Dec 2017

See all articles by Pavel A. Yakovlev

Pavel A. Yakovlev

Duquesne University

Mehmet Serkan Tosun

University of Nevada, Reno - Department of Economics; IZA Institute of Labor Economics

William Lewis

Duquesne University

Date Written: December 25, 2017

Abstract

This study estimates the effect of state legislative term limits on state tax revenue, general expenditure and its main components: welfare, highways, health, education, and state aid to local governments. Two alternative measures of term limits are used: an original term limit index developed in this paper and the potentially endogenous average legislative turnover rate. Controlling for economic, institutional, political, and demographic factors as well as the endogeneity of legislative turnover, we find that the two distinct measures of term limits have qualitatively similar effects on state government finances. Our estimates indicate that stricter legislative term limits not only increase legislative turnover and the size of government, but also change the composition of government spending.

Keywords: Term Limits, State Government Finances, Rent Seeking, Education, Welfare, Health, Intergovernmental Aid, Transfers

JEL Classification: H7, H3

Suggested Citation

Yakovlev, Pavel A. and Tosun, Mehmet Serkan and Lewis, William, The Fiscal Consequences of State Legislative Term Limits (December 25, 2017). Available at SSRN: https://ssrn.com/abstract=3093111 or http://dx.doi.org/10.2139/ssrn.3093111

Pavel A. Yakovlev (Contact Author)

Duquesne University ( email )

600 Forbes Avenue
Pittsburgh, PA 15282
United States

Mehmet Serkan Tosun

University of Nevada, Reno - Department of Economics ( email )

1664 N. Virginia Street
Reno, NV 89557
United States
775-784-6678 (Phone)

HOME PAGE: http://www.coba.unr.edu/econ/

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

William Lewis

Duquesne University

600 Forbes Avenue
Pittsburgh, PA 15282
United States

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