The Electoral Consequences of Large Fiscal Adjustments / Alberto F. Alesina, Dorian Carloni, Giampaolo Lecce.

Format:

Book

Author/Creator:

Alesina, Alberto F.

Contributor:

National Bureau of Economic Research.

Carloni, Dorian.

Lecce, Giampaolo.

Series:

Working Paper Series (National Bureau of Economic Research) no. w17655.

NBER working paper series no. w17655

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2011.

Summary:

The conventional wisdom regarding the political consequences of large reductions of budget deficits is that they are very costly for the governments which implement them: they are punished by voters at the following elections. In the present paper, instead, we find no evidence that governments which quickly reduce budget deficits are systematically voted out of office in a sample of 19 OECD countries from 1975 to 2008. We also take into consideration issues of reverse causality, namely the possibility that only "strong and popular" governments can implement fiscal adjustments and thus they are not voted out of office "despite" having reduced the deficits. In the end we conclude that many governments can reduce deficits avoiding an electoral defeat.

Notes:

Print version record

December 2011.