Are Citizens Austerians? Evidence from Survey Experiments on Budgetary Priorities

In the wake of the European sovereign debt crisis, governments across the continent adopted austerity. Existing research claims that fiscally conservative citizens support such fiscal policies. However, this literature largely ignores that fiscal consolidation carries substantial trade-offs. In hard times, governments have to cut spending or raise taxes to reduce government debt. We account for these budgetary trade-offs by using a split-sample and conjoint survey experiment conducted in four European countries. The results show that fiscal consolidation is not a priority for citizens: When forced to make a choice, support for reducing debt at the cost of lower spending or higher taxes is much smaller than in an unconstrained setting. Revenue-based consolidations are especially unpopular, but expenditure-based consolidations are also contested. Moreover, the public has clear budgetary priorities: People do not favor lower debt and taxes, but they support more progressive taxes to pay for higher government spending.

Time to Change Budgetary Priorities in the Eurozone

With the spectre of a recession looming in the eurozone (and elsewhere), the policy question arises as to how much leeway do the fiscal authorities in the eurozone have to follow counter-cyclical fiscal policies aimed at providing some stimulus to the economy.

Sound Off!: Why I Use Interactive Whiteboards

In its January 27, 2010, online issue, Teacher magazine published “Why I Hate Interactive Whiteboards,” a passionate article by Bill Ferriter. Hatred seems like a strong reaction to an inanimate object, but here it is tied to frustration about budgetary priorities, the lck of evaluation of the effectiveness of interactive whiteboards (IWBs), and the lack of accompanying training.

Upsetting National Priorities: The Reagan Administration's Budgetary Strategy

We use simulations based on a multiequation model of federal budgetary outcomes to assess the Reagan administrations impact on the federal budget during fiscal years 1982–86. Reagan's aggregate budget priorities represent a significant departure from the priorities of prior postwar administrations. The bulk of this shift in priorities had occurred by fiscal 1984. Defense spending and uncontrollable domestic spending were higher, and spending on domestic controllable programs lower under Reagan than they would otherwise have been. The distinctiveness of Reagan's budgetary priorities can be attributed to his tax cuts and—far from a strategy of “starving the budget by reducing revenues”—to a failure to allow fiscal pressures to restrain spending. The model projects that without tax cuts Reagan's predecessors would have spent no less on defense than Reagan. Cutting taxes increased the deficit by about $400 billion cumulatively during fiscal years 1982–86 and reduced expenditures by roughly $30 billion.