Are citizens willing to reduce public debt? Beliefs, information and policy preferences

Massimo Bordignon (), Nicolò Gatti () and Gilberto Turati ()
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Massimo Bordignon: Università Cattolica del Sacro Cuore
Nicolò Gatti: Università Cattolica del Sacro Cuore
Gilberto Turati: Università Cattolica del Sacro Cuore

No def144, DISCE - Working Papers del Dipartimento di Economia e Finanza from Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE)

Abstract: This paper investigates how raising awareness of public debt sustainability affects individual attitudes toward debt reduction and fiscal policy preferences. Using a survey experiment on a representative sample of the Italian population, we randomly assign objective information about government debt to citizens, who become more sensitive to the risks of tax increases, spending cuts, and imbalances for future generations. We find no effect on the perception of debt reduction as an urgent policy priority. While remaining highly averse to any tax increase, treated respondents support spending cuts (but not in education and health care) as a policy to reduce the debt burden. We also show that subjects with distorted beliefs about government debt are no more responsive to the information treatment than subjects with correct beliefs, shedding light on the challenges of building a voting majority for debt-stabilizing policies.

Keywords: public debt; fiscal policies; beliefs; information. (search for similar items in EconPapers)
JEL-codes: D83 H31 H63 (search for similar items in EconPapers)
Pages: 52
Date: 2025-07
New Economics Papers: this item is included in nep-eur, nep-exp and nep-mac
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