Alesina, Alberto; Campante, Filipe R.; Tabellini, Guido - In: Journal of the European Economic Association 6 (2008) 5, pp. 1006-1036
Fiscal policy is procyclical in many developing countries. We explain this policy failure with a political agency problem. Procyclicality is driven by voters who seek to "starve the Leviathan" to reduce political rents. Voters observe the state of the economy but not the rents appropriated by...