Austerity and elections
Alberto Alesina, Gabriele Ciminelli, Davide Furceri and Giorgio Saponaro
This paper revisits the conventional but unproven wisdom that voters penalize governments for adopting fiscal austerity in a sample of advanced economies. We consider the composition of the austerity package and the economic manifesto of the implementing government and find that austerity packages consisting mostly of tax hikes have a significant electoral cost, which is larger for government parties that campaigned on a free-market manifesto. Conversely, expenditure-based austerity is costlier for government parties that did not run on a small-government platform, but may be beneficial for those that did. We show in a model that these results are an equilibrium outcome of the strategic interaction between polarized voters’ mobilizers and centrist politicians. These politicians may be either unwilling or temporarily forced not to fulfil their campaign promises. Mobilizers lack information about the politicians’ types and punish them whenever they observe a deviation to the centre.
Year of publication: |
24 February 2024
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Authors: | Alesina, Alberto ; Ciminelli, Gabriele ; Furceri, Davide ; Saponaro, Giorgio |
Publisher: |
London : Centre for Economic Policy Research |
Subject: | Austerity | Elections | Ideology | Manifesto | Tax hikes | Expenditure cuts | Haushaltskonsolidierung | Fiscal consolidation | Wahl | Election | Ideologie | Steuerpolitik | Tax policy | Wahlverhalten | Voting behaviour | Öffentliche Ausgaben | Public expenditure |
Saved in:
Online Resource
Extent: | 1 Online-Ressource (circa 80 Seiten) Illustrationen |
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Series: | Discussion papers / CEPR. - London : CEPR, ZDB-ID 2001019-9. - Vol. DP18859 |
Type of publication: | Book / Working Paper |
Type of publication (narrower categories): | Graue Literatur ; Non-commercial literature ; Arbeitspapier ; Working Paper |
Language: | English |
Source: | ECONIS - Online Catalogue of the ZBW |
Persistent link: https://www.econbiz.de/10014482952