Term Length and Public Finances: The Case of U.S. Governors

Jonas Klarin

No 2019:5, Working Paper Series from Uppsala University, Department of Economics

Abstract: This paper studies how a politician’s term length affects public finances. I test whether the gradual increase fromtwo- to four-year terms for American governors affects state finances using a rich state-year panel stretching back almost a century. The results show that adopting four-year terms decreases annual expendituresand revenues by 6 %. The effect of the reform is present immediately after voters approve the ballot measure, when the last two-year-term governor is still in office, which suggests that the mechanism at work is stronger re-election incentives for the incumbent. The effect is larger among electorally ’at risk’ governors. Democratic governors respond to longer terms by increasing public employment instead of decreasing expenditures.

Keywords: Term Length; U.S. Governors; Political Agency; Elections (search for similar items in EconPapers)
JEL-codes: D72 H11 H70 P16 (search for similar items in EconPapers)
Pages: 50 pages
Date: 2019-05-08
New Economics Papers: this item is included in nep-pbe and nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://uu.diva-portal.org/smash/get/diva2:1314316/FULLTEXT01.pdf Full text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hhs:uunewp:2019_005

Access Statistics for this paper

More papers in Working Paper Series from Uppsala University, Department of Economics Department of Economics, Uppsala University, P. O. Box 513, SE-751 20 Uppsala, Sweden. Contact information at EDIRC.
Bibliographic data for series maintained by Ulrika Öjdeby ().