Political Stability and Fiscal Policy - Time Series Evidence for the Swiss Federal Level since 1849

No 2691, CESifo Working Paper Series from CESifo

Abstract: This paper explores the role of political stability on fiscal policy choices in a time-series ana-lysis over 158 years on the Swiss federal level. We argue that the fiscal-commons problem of public finances is affected by the time-horizon of a finance minister. Arguably, the incentives for an incumbent to maintain a good reputation with sound policy decisions are stronger the longer the time-horizon of a respective term. In addition, a finance minister who succeeds to stay a long time in office normally enjoys a politically powerful position towards the parlia-ment, the administration and the interest groups to influence policy decisions. In contrast, fre-quent government turnover weakens the position of the finance minister.

Keywords: political stability; fiscal policy; constitutional changes (search for similar items in EconPapers)
JEL-codes: D78 H11 H50 H61 (search for similar items in EconPapers)
Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Journal Article: Political stability and fiscal policy: time series evidence for the Swiss federal level since 1849 (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_2691

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