How a sustainable fiscal policy can be performed in a federal system is not only a Swiss problem but is also discussed in other federal countries like Germany and Austria, and in the European Union. Contrary to most other countries, the Swiss fiscal system is characterised by an extensive fiscal...

The advantages and disadvantages of fiscal federalism are widely discussed in economics and political science. While some authors argue that federalism favors individual initiatives and serves as a market preserving device, others emphasize the dangers arising from an increasing corruption and...

In this paper, the introduction of direct-democratic decision-making in all EU decisions is considered when it is feasible without prohibitively increasing decision-making costs. We start with the contractarian argument that each constitution is a contract joining the citizens of a state and...

The weak rationality principle is not an empirical statement but a heuristic rule for how to proceed in social sciences. It is a necessary ingredient of any 'understanding' social science in the Weberian sense. In this paper, first this principle and its role in economic theorizing are...

In this paper, institutions are described which are designed to reach sustainability of public finances in the Swiss cantons. These are on the one hand direct popular rights, the fiscal referendum in particular, which allow citizens to express their fiscal preferences. These are on the other...

Was Swiss federal fiscal policy sustainable over the period from 1900 to 2002? We perform unit root and cointegration tests for federal revenues and expenditures, taking into account a structural shift related to World War II. We find sustainability over the entire period. However, splitting the...

None