Fiscal restraints have been argued to force today's governments to internalize the externalities that result from extensive borrowing on future electorates and governments as well as on other countries by causing fiscal instability. In this article we provide an alternative argument for fiscal...

Fiscal restraints have been argued to force today's governments to internalize the externalities that result from extensive borrowing on future electorates and governments as well as on other countries by causing fiscal instability. In this article we provide an alternative argument for fiscal...

This article reviews a rapidly growing literature on how climatic risks and events affect public finances around the world. This literature includes empirical evaluations of how past climatic events have affected fiscal outcomes, empirical and model-based assessments of how climatic risks affect...

Although pre-electoral political manipulation of the budget --- the political budget cycle (PBC) --- has been long investigated by scholars, empirical findings are mixed at best. This is partly because of the non-random nature of election timing. There also exist ongoing debates over how the...

The literature on the common pool resource problem in budgeting has thus far not explored the likely interaction between 'size fragmentation' (the number of decision makers) and 'procedural fragmentation' (the structure of the process in which they interact). The argument put forward in this...

Elected representatives have little incentive to pursue the interests of those electing them once they are elected. This well-known principal agent problem leads, in a variety of theories of government, to nonoptimally large levels of government expenditure. An implication is that budgetary...

What explains subnational policy choices over tax cut after decentralization? We test two different explanations in the context of the 2002 tax reform in Russia. A popular strand of literature suggests that decentralization induces more regional competition over investment, motivating...

Fiscal rules, i.e., constraints to the policymaking discretion of elected officials in terms of deficit and expenditures, are widely used tools to regulate fiscal policies. This paper shows that they can negatively affect the quality of candidates willing to run for office. We build a simple...

Does politician quality matter for policy in representative governments? I use administrative registry data on local politicians in Finland and exploit exogenous variation generated by close electoral races that shift the quality composition of local councils to show that (i) electing more...