Economies governed by former economics students grow faster than economies governed by leaders with other education backgrounds; a result which is most evident for presidents. Faster growth (average growth) occurs during an economic leader's first year (entire tenure), primarily through...

The idea of a Universal Basic Income (UBI) is heavily discussed in the UK, with support and opposition from several parts of the political spectrum. This idea has been around for a long time and was first formulated more than two centuries ago. There have been several times when it has attracted...

What explains cross-national differences in the fiscal impact of government, including the size of the welfare state? Standard explanations center on citizen and government ideology and ethnic heterogeneity, with a smaller role for institutions such as majoritarianism, presidentialism, and...

This paper analyzes the institutional conditions affecting the establishment and effectiveness of independent central banks and of budgetary institutions. It draws on the recent theory developed by North, Wallis and Weingast on the transition from a closed and fragile state to an open economic...

Unanticipated changes in tax policy are likely to have different macroeconomic effects compared to anticipated changes due to several mechanisms, including fiscal foresight and policy uncertainty. It is therefore important to understand what drives such policy surprises. We explore the nature of...

This paper explores the political economy of fiscal adjustment. It begins with an examination of the evidence for, and sources of, ‘deficit bias', including political and governance factors, public attitudes, the role of financial markets and imprecision about which debt targets should be...

This paper estimates the causal effect of fiscal rules on fiscal balances in a panel of 142 countries over the period 1985-2015. Our instrumental variable strategy exploits the geographical diffusion of fiscal rules across countries. The intuition is that reforms in neighboring countries may...

This paper explores the political economy of fiscal adjustment. It begins with an examination of the evidence for, and sources of, ‘deficit bias’, including political and governance factors, public attitudes, the role of financial markets and imprecision about which debt targets should be...

This paper attempts to extend the theoretical and empirical methodology employed in previous literature, by proposing a utility maximization process to estimate the optimal tax revenue from a sample of 30 countries. It is shown that an optimal tax system is defined solely by two crucial...

The most recent literature on aid effectiveness finds a positive effect of aid on growth. To the extent that aid goes through the budget, this either reflects an aid-financed increase in government expenditures (quantity effect) or an improvement in the use of government resources as a result of...