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Economic Theories on Political Parties - Dictionary of Arguments

Mause I 284f
Political Parties/Economic Theories: most models have in common that they expect left-wing governments to pursue a much more expansionary fiscal policy.(For references see Political Parties/Hibbs.)
There are arguments to the contrary. It could be a strategy of right-wing parties to show paradoxical behaviour and to get into debt in order to take away the financial leeway for future left-wing governments for higher social spending (see, for example, Persson and Svensson 1989 (1); Milesi-Feretti and Spoalore 1994) (2)
It could also be that left-wing governments with low unemployment have no incentive for expansionary deficit spending and reduce deficits to create a future fiscal leeway (see Carlsen 1997 (3); Cusack 1999 (4)).
Numerous empirical studies in the period that followed show that left-wing governments spend more than right-wing governments.
The thesis that left and right-wing parties are converging in spending policy in the face of pressure for reform and increasing interdependence was not confirmed. (5), (6).

1. Torsten Persson & Lars E. O. Svensson. 1989. Why a stubborn conservative would run a deficit: Policy with time-inconsistent preferences. Quarterly Journal of Economics 104 (2): 325– 345.
2. Gian M. Milesi-Feretti & Enrico Spoalore. 1994. How cynical can an incumbent be? Strategic policy in a model of government spending. Journal of Public Economics 55: 121– 140.
3. Fredrik Carlsen, Fredrik. 1997. Counterfiscal policies and partisan politics: Evidence from industrialized countries. Applied Economics 29: 145– 151.
4. Thomas R. Cusack, 1999. Partisan politics and fiscal policy. Comparative Political Studies 32( 4): 464– 486.
5, James P. Allan & Lyle Scruggs. 2004. Political partisanship and welfare state reform in advanced industrial societies. American Journal of Political Science 48 (3): 496– 512.
6. Niklas Potrafke. 2009. Did globalization restrict partisan politics? An empirical evaluation of social expenditures in a panel of OECD countries. Public Choice 140 (1): 105– 124.

Explanation of symbols: Roman numerals indicate the source, arabic numerals indicate the page number. The corresponding books are indicated on the right hand side. ((s)…): Comment by the sender of the contribution. Translations: Dictionary of Arguments
The note [Author1]Vs[Author2] or [Author]Vs[term] is an addition from the Dictionary of Arguments. If a German edition is specified, the page numbers refer to this edition.
Economic Theories
Mause I
Karsten Mause
Christian Müller
Klaus Schubert,
Politik und Wirtschaft: Ein integratives Kompendium Wiesbaden 2018

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