This paper examines the implications of habit formation in private and public consumption for the Pareto-efficient provision of public goods, based on a two-period model with nonlinear taxation. If the public good supply is time-invariant, the presence of habit formation generally alters the...

We study budget formation in a model featuring separation of powers. In our model,the legislature designs a budget bill that can include a cap on total spending and ear-marked allocations to designated public projects. Each project provides random benefits to one of many interest groups. The...

Polities differ in the extent to which political parties can pre-commit to carry out promised policy actions if they take power. Commitment problems may arise due to a divergence between the ex ante incentives facing national parties that seek to capture control of the legislature and the ex...