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Local governments in Japan account for about 80 per cent of general government spending when excluding social security expenditures. Therefore, for the implementation of fiscal policy it is important how local governments will behave. On the basis of the economic theories on fiscal federalism it...
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during the 1985 - 2001 period. We find that in election years public expenditures increase, but revenues also do - a result … influence of party alignment between governors and president. Public expenditures in election years increase in aligned …
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. We find that in election years with fiscal rules in place, public consumption is reduced by 1.6 percentage point of GDP … as compared to election years without these rules. This impact is equivalent to a reduction by a third of the volatility …
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