Budget Referendums and Government Spending: Evidence from Swiss

Lars Feld and John Matsusaka

No 323, CESifo Working Paper Series from CESifo

Abstract: New government spending must be approved by a referendum of citizens in many Swiss cantons. This decisionmaking procedure seems like a simple way to address citizen-legislator agency problems, but little systematic evidence is available concerning its effect on spending outcomes. We estimate spending regressions for Swiss cantons using panel data from 1986 to 1997. After controlling for demographics and other determinants of spending, mandatory referendums on new spending are found to reduce the size of the budget by 17% for the median canton.

Keywords: Budget referendums; initiatives; government spending (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (21)

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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_323

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