scholarly journals Political Budget Cycle, Tax Collection, and Yardstick Competition

2021 ◽  
Vol 0 (0) ◽  
Author(s):  
Massimiliano Ferraresi
Keyword(s):  
Property Tax ◽  
User Fees ◽  
The Political ◽  
Strategic Interactions ◽  
Personal Income Tax ◽  
Yardstick Competition ◽  
Political Budget Cycle ◽  
Spatially Correlated ◽  
Competition Hypothesis ◽  
Political Cycle

Abstract This paper exploits the political cycle of Italian municipalities to test for the presence of strategic interactions in the collection of local taxation. The revenue from the personal income tax surcharge—a tax tool of low salience—is (positively) plagued by political manipulation and is found to be a strategic complement, but only when mayors run for re-election, a finding consistent with the yardstick competition hypothesis. More salient fiscal tools, such as property tax and user fees and charges, are also (negatively) affected by budget cycles, but they do not appear to be spatially correlated.

scholarly journals Political cycles, spatial interactions and yardstick competition: evidence from Italian cities

2019 ◽  
Vol 20 (4) ◽  
pp. 1093-1115
Author(s):  
Massimiliano Ferraresi
Keyword(s):  
Local Governments ◽  
Strategic Interactions ◽  
Yardstick Competition ◽  
Spatial Interactions ◽  
Political Cycles ◽  
Competition Hypothesis ◽  
Political Cycle ◽  
Fiscal Behavior ◽  
Novel Strategy ◽  
Analysis Point

Abstract I aim to identify the presence of spatial interactions among local governments by exploiting a novel strategy. Specifically, I take advantage of the political cycle of Italian municipalities over the period of 2001–2011 to isolate the effect of the spending decisions of one municipality on neighboring municipalities. The results of this analysis point to the presence of strategic interactions between neighboring municipalities and indicate that such fiscal behavior is more pronounced during electoral years compared to non-electoral ones, when municipalities are governed by coalitions backed by a small majority, and in cities guided by a mayor who can run for re-election. Taken together, these results suggest that the observed spatial dependence in spending decisions seems to be consistent with the yardstick competition hypothesis.

Electoral and Partisan Cycles in the Canadian Provinces

1999 ◽  
Vol 32 (2) ◽  
pp. 273-292 ◽  
Author(s):  
François Petry ◽  
Louis M. Imbeau ◽  
Jean Crête ◽  
Michel Clavet
Keyword(s):  
The Political ◽  
Discretionary Power ◽  
Normal Behaviour ◽  
Political Budget Cycle ◽  
Budget Cycle ◽  
Opportunistic Behaviour ◽  
Electoral Defeat ◽  
Canadian Provinces ◽  
The Government ◽  
Expansionary Policy

AbstractThis study tests explanations of the growth of Canadian provincial governments that draw from the political budget cycle approach. The approach assumes that governments jointly respond to electoral and partisan goals. When the next election is not expected soon, the government uses its discretionary power to pursue its ideological target. When the next election is near, politicians in government, fearing electoral defeat, deviate from their normal behaviour and engage in a re-election effort by undertaking an expansionary policy. This study suggests that provincial governments behave in the opportunistic fashion described by the model. Moreover, there is no sign that this opportunistic behaviour has been affected by government cutbacks in the 1990s.

US Corporate Investment Over the Political Cycle

2015 ◽  
Vol 05 (01) ◽  
pp. 1550015 ◽  
Author(s):  
Adam Yonce
Keyword(s):  
Regulatory Policy ◽  
Cash Flows ◽  
The Political ◽  
Political Environment ◽  
Investment Behavior ◽  
Party Government ◽  
Investment Theory ◽  
Regulatory Uncertainty ◽  
Political Cycle ◽  
Investment Opportunities

The investment behavior of US firms exhibits systematic variation over the political cycle. After controlling for investment opportunities, US firms reduce investment expenditures approximately 2.0% during Presidential election years, 5.3% during periods of single-party government, and 8.7% during Republican presidential administrations. Neoclassical investment theory has little to say about direct links between investment and the political environment. I show that the empirical results arise naturally in a model of investment under regulatory and political uncertainty, provided that (i) regulatory policy affects the cash flows of the firm, (ii) firms have flexibility over the scale of their investments and (iii) regulatory uncertainty resolves quickly.

Senatorial responsiveness, the characteristics of the polity and the political cycle

Public Choice ◽  
1982 ◽  
Vol 38 (3) ◽  
pp. 263-269 ◽  
Author(s):  
Kenneth V. Greene ◽  
Hadi Salavitabar
Keyword(s):  
The Political ◽  
Political Cycle

scholarly journals Revenue Decentralization, Central Oversight and the Political Budget Cycle: Evidence from Israel

2015 ◽  
Author(s):  
Thushyanthan Baskaran ◽  
Sebastian Blesse ◽  
Adi Brender ◽  
Yaniv Reingewertz
Keyword(s):  
The Political ◽  
Political Budget Cycle ◽  
Budget Cycle

Yardstick Competition among Governments

2019 ◽  
Author(s):  
Pierre Salmon
Keyword(s):  
Information Asymmetry ◽  
Policy Making ◽  
The Political ◽  
Yardstick Competition ◽  
National Governments

When the existence of several jurisdictions (countries, regions, or cities) is acknowledged, the possibility arises that citizens compare what obtains in their own jurisdiction to what obtains in others. These cross-jurisdiction or yardstick comparisons can have an effect on citizens’ support of incumbents (yardstick voting) and, as a consequence, an effect on governments’ decisions, making them interact (political yardstick competition proper). Both effects have been mainly studied in the context of federalism and decentralization, with the policy variables concerned being mostly fiscal (taxes and expenditures). In that relatively simple setting, the two effects have been confirmed empirically. This book aims to document and analyze that achievement and also to extend the analysis to broader settings in terms of jurisdictions and policy domains. It is mostly in that broader context, especially when national governments are involved, that the systemic implications of yardstick competition come to the fore. With regard to electoral or downward accountability, the mechanism tends to re-empower citizens by mitigating the disabling effects of information asymmetry. With regard to policy-making, yardstick competition represents a force, latent or actual, that constrains or influences the decisions of governments. The mechanism is simple but the political settings in which it operates, crucial for its understanding, are definitely complex. A methodological justification of how the matter is treated is placed at the end of the book.

Just in time: Political policy cycles of land reform

Politics ◽  
2019 ◽  
Vol 40 (2) ◽  
pp. 207-226
Author(s):  
Andrew Q Philips
Keyword(s):  
Land Reform ◽  
Just In Time ◽  
The Political ◽  
Historical Survey ◽  
Land Reforms ◽  
Political Budget Cycle ◽  
Political Policy ◽  
Redistributive Policies ◽  
Policy Cycles ◽  
The Impact

While the political budget cycle literature focuses on the manipulation of existing policies, an analysis of the impact of the passage of redistributive policies themselves remains absent. I contend that policy passage is a strategically timed signal to voters used before elections to benefit the incumbent. Using aggregate data on land reforms in India from 1957 to 1992, I find that reforms are indeed timed before elections. Second, using historical survey data, I show that land issues remain a strong signal to Indian voters over time, even in states that have already enacted reforms. These findings provide evidence for political policy cycles.

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