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Explaining budgetary indiscipline: evidence from Spanish municipalities

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dc.contributor.author Lago Peñas, Ignacio
dc.contributor.author Lago Peñas, Santiago
dc.date.accessioned 2021-07-14T09:39:22Z
dc.date.available 2021-07-14T09:39:22Z
dc.date.issued 2008
dc.identifier.citation Lago-Peñas I, Lago-Peñas S. Explaining budgetary indiscipline: evidence from Spanish municipalities. Public Finance and Management. 2008 Dec 29;8(1):36-69.
dc.identifier.issn 1523-9721
dc.identifier.uri http://hdl.handle.net/10230/48184
dc.description.abstract The search for political support leads ultimately to upward deviations from forecasted public deficits when i) budget procedures are soft, ii) breaking promises made on higher expenditures and the lowering of taxes is costly in political terms, and iii) ex-post control by voters and political opposition is imperfect. This hypothesis is tested using a data set from Spanish municipalities during the period 1985-1995. Econometric estimates demonstrate that single-party majority incumbents are less prone to change forecasted budgets. While their forecasted deficits tend to be higher, they have lower actual deficits, which may be interpreted as the consequence of a higher consistency in the budgetary process. Secondly, upward deviations in deficit tend to rise in election years. While forecasted deficits are not different in election years, actual deficits are. Moreover, elections cause systematic downward deviations in revenues. On the contrary, the incumbent’s ideology is not relevant when explaining deviations in deficit.
dc.format.mimetype application/pdf
dc.language.iso eng
dc.publisher Instituto de Estudios Fiscales
dc.relation.ispartof Public Finance and Management. 2008 Dec 29;8(1):36-69
dc.rights © 2008. Instituto de Estudios Fiscales.
dc.title Explaining budgetary indiscipline: evidence from Spanish municipalities
dc.type info:eu-repo/semantics/article
dc.subject.keyword Budget deficits
dc.subject.keyword Local governments
dc.subject.keyword Budget procedures
dc.subject.keyword Electoral promises
dc.rights.accessRights info:eu-repo/semantics/openAccess
dc.type.version info:eu-repo/semantics/publishedVersion

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