The effect of legislature size on public spending: evidence from a regression discontinuity design

Public Choice ◽  
2017 ◽  
Vol 173 (3-4) ◽  
pp. 345-367 ◽  
Author(s):  
Daniel Höhmann
Keyword(s):  
Regression Discontinuity ◽  
Public Spending ◽  
Regression Discontinuity Design ◽  
Legislature Size

scholarly journals Does Electoral Competition Curb Party Favoritism?

2018 ◽  
Vol 10 (4) ◽  
pp. 378-407 ◽  
Author(s):  
Marta Curto-Grau ◽  
Albert Solé-Ollé ◽  
Pilar Sorribas-Navarro
Keyword(s):  
Local Governments ◽  
Regression Discontinuity ◽  
Electoral Competition ◽  
Public Spending ◽  
Regression Discontinuity Design ◽  
Large Margin ◽  
Spanish Regions ◽  
Previous Election

We study whether incumbents facing uncontested elections channel public spending toward co–partisan officials more than is the case of incumbents that are worried about reelection. We draw on data on capital transfers allocated by Spanish regions to local governments during 1995–2007. Using a regression discontinuity design, we document strong and robust effects. We find that a mayor belonging to the party of the regional president obtains twice the amount in grants received by an opposition’s mayor. This effect is much greater for regional incumbents that won the previous election by a large margin, but it disappears for highly competitive elections. (JEL D72, H76)

scholarly journals Direct democracy and government size: evidence from Spain

2019 ◽  
Vol 8 (4) ◽  
pp. 630-645 ◽  
Author(s):  
Carlos Sanz
Keyword(s):  
Economic Policy ◽  
Special Interest ◽  
Direct Democracy ◽  
Regression Discontinuity ◽  
Public Spending ◽  
Government Size ◽  
Similar Amount ◽  
Regression Discontinuity Design ◽  
Budget Deficits ◽  
Effect Regression

AbstractI study the effects of direct democracy on economic policy in a novel setting. In Spain, national law determines that municipalities follow either direct or representative democracy, depending on their population size. Using a fixed-effect regression discontinuity design, I find that direct democracy leads to a smaller government, reducing public spending by around 8 percent. Revenues decrease by a similar amount and, therefore, there is no effect on budget deficits. These findings can be explained by a model in which direct democracy allows voters to enforce lower special-interest spending. I provide several additional results and discuss alternative mechanisms.

scholarly journals Government Spending and Legislative Organization: Quasi-Experimental Evidence from Germany

2010 ◽  
Vol 2 (4) ◽  
pp. 200-212 ◽  
Author(s):  
Peter Egger ◽  
Marko Koethenbuerger
Keyword(s):  
Government Spending ◽  
Regression Discontinuity ◽  
Positive Impact ◽  
Public Spending ◽  
Regression Discontinuity Design ◽  
Legislative Organization ◽  
Endogeneity Bias ◽  
German State ◽  
Quasi Experimental ◽  
Positive Effect

This paper presents empirical evidence of a positive effect of council size on government spending using a dataset of 2,056 municipalities in the German state of Bavaria over a period of 21 years. We apply a regression discontinuity design to avoid an endogeneity bias. In particular, we exploit discontinuities in the legal rule that relate population size of a municipality in order to council size to identify a causal relationship between council size and public spending, and find a robust positive impact of council size on spending. Moreover, we show that municipalities primarily adjust current expenditure in response to a rise in council size. (JEL D72, H72, R51)

scholarly journals Regional Transfer Multipliers

2018 ◽  
Vol 86 (5) ◽  
pp. 1901-1934 ◽  
Author(s):  
Raphael Corbi ◽  
Elias Papaioannou ◽  
Paolo Surico
Keyword(s):  
Regression Discontinuity ◽  
Causal Effect ◽  
Public Spending ◽  
Fuzzy Regression ◽  
Regression Discontinuity Design ◽  
Allocation Mechanism ◽  
Municipal Governments ◽  
Local Labour ◽  
Income Multiplier ◽  
Fuzzy Regression Discontinuity Design

Abstract A series of discontinuities in the allocation mechanism of federal transfers to municipal governments in Brazil allow us to identify the causal effect of public spending on local labour markets, using a “fuzzy” Regression Discontinuity Design (RDD). Our estimates imply a cost per job of about 8,000 US dollars per year and a local income multiplier around two. The effect comes mostly from employment in services and is more pronounced among less financially developed municipalities.

scholarly journals Effectiveness of a Power Factor Correction Policy in Improving the Energy Efficiency of Large-Scale Electricity Users in Ghana

Energies ◽  
2019 ◽  
Vol 12 (13) ◽  
pp. 2582 ◽  
Author(s):  
Samuel Lotsu ◽  
Yuichiro Yoshida ◽  
Katsufumi Fukuda ◽  
Bing He
Keyword(s):  
Energy Efficiency ◽  
Power Factor ◽  
Large Scale ◽  
Regression Discontinuity ◽  
Power Factor Correction ◽  
Energy Crisis ◽  
Regression Discontinuity Design ◽  
The Government ◽  
Power Factor Improvement ◽  
The Impact

Confronting an energy crisis, the government of Ghana enacted a power factor correction policy in 1995. The policy imposes a penalty on large-scale electricity users, namely, special load tariff (SLT) customers of the Electricity Company of Ghana (ECG), whose power factor is below 90%. This paper investigates the impact of this policy on these firms’ power factor improvement by using panel data from 183 SLT customers from 1994 to 1997 and from 2012. To avoid potential endogeneity, this paper adopts a regression discontinuity design (RDD) with the power factor of the firms in the previous year as a running variable, with its cutoff set at the penalty threshold. The result shows that these large-scale electricity users who face the penalty because their power factor falls just short of the threshold are more likely to improve their power factor in the subsequent year, implying that the power factor correction policy implemented by Ghana’s government is effective.

How Much of the Incumbency Advantage is Due to Scare-Off?

2015 ◽  
Vol 3 (3) ◽  
pp. 493-514 ◽  
Author(s):  
Andrew B. Hall ◽  
James M. Snyder
Keyword(s):  
Regression Discontinuity ◽  
Regression Discontinuity Design ◽  
Incumbency Advantage ◽  
Previous Election ◽  
Us Senate ◽  
State Legislative

This paper uses a regression discontinuity design to estimate the degree to which incumbents scare off challengers with previous officeholder experience. The estimates indicate a surprisingly small amount of scare-off, at least in cases where the previous election was nearly tied. As Lee and others have shown (and as we confirm for our samples) the estimated party incumbency advantage in these same cases is quite large—in fact, it is about as large as the average incumbency advantage for all races found using other approaches. Drawing from previous estimates of the electoral value of officeholder experience, we thus calculate that scare-off in these cases accounts for only about 5–7 percent of the party incumbency advantage. We show that these patterns are similar in elections for US House seats, statewide offices and US senate seats, and state legislative seats.

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