Political business cycles at the municipal level

Linda Veiga and Francisco Veiga

ERSA conference papers from European Regional Science Association

Abstract: The political article tests for rational political business cycles models on an unexplored and large data set of Portuguese municipalities. This data allows for a clean test of the models due to its high level of detail on expenditure items, an exogenous fixed election schedule and the homogeneity of local governments with respect to policy instruments and institutions. Estimation results clearly reveal the opportunistic behaviour of local governments, that in pre-electoral periods, increase expenditure on items highly visible to the electorate such as roads and street construction, in an effort to signal competence and increase their chances of re-election. JEL classification: H72, D72, D78 Keywords: political business cycles, public finance, local governments

Date: 2004-08
New Economics Papers: this item is included in nep-geo, nep-mac, nep-pbe and nep-pol
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Citations: View citations in EconPapers (15)

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Related works:
Journal Article: Political business cycles at the municipal level (2007)
Working Paper: Political Business Cycles at the Municipal Level (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:wiw:wiwrsa:ersa04p427

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