The Swiss debt brake is widely appreciated as one of the most rationally designed fiscal rules in the world and was thus also discussed as blueprint in the debates about fiscal rules in Germany, the European Union member states and Israel. However, evidence that this rule really contributes to...

The fiscal commons problem is one of the most prominent explanations of excessive spending and indebtedness in political economics. The more fragmented a government, the higher its spending, deficits and debt. In this paper we investigate to what extent this problem can be mitigated by different...

The paper investigates the fiscal effects of Swiss cantonal debt brakes by taking explicitly into account the rules' coverage. An in-depth analysis provides unique evidence that suggests the following: First, fiscal rules at the cantonal level have a negative effect on public deficits, which is...

This paper provides new evidence on the sustainability of public finances in German states (Laender) by exploiting a newly compiled database covering the years 1950 - 2011. Unlike previous studies on Germany, we analyze fiscal sustainability by applying "gsecond generation" panel cointegration...

In this paper we analyze the sustainability of public finances in the states (Laender) of the Federal Republic of Germany using an unprecedentedly comprehensive fiscal dataset for the time period from 1950 to 2011 for West German Laender and 1991 to 2011 for East German Laender, respectively. In...

New government spending must be approved by a referendum of citizens in many Swiss cantons. This decisionmaking procedure seems like a simple way to address citizen-legislator agency problems, but little systematic evidence is available concerning its effect on spending outcomes. We estimate...

In this paper, we extend Henning Bohn's (2008) fiscal sustainability test by allowing for slope heterogeneity and cross-sectional dependence (CD). In particular, our econometric approach is the first that allows fiscal reaction functions (FRF) to capture unobserved heterogeneous effects from...

Following the ambiguous results in the literature aimed at understanding the empirical link between fiscal federalism and economic growth, this paper revisits the question using a Bayesian Model Averaging approach. The analysis suggests that the failure to appropriately account for model...

Rational politicians are interested in judicial independence (JI) in order to make their promises credible. But if politicians preferences deviate from the dicta of the judiciary, they also have incentives to renege on judicial independence. These two conflicting aspects are measured by two...

Over 10 years ago, Feld and Voigt (2003) introduced the first indicator for objectively meas-uring the actual independence of the judiciary and demonstrated its utility in a large cross-section of countries. The indicator has been widely used, but also criticized. This paper pre-sents more...