Governments often choose deficit financing over budget cuts or tax increases to fund public goods, driven by the political unpopularity of the latter options. This study investigates the potential trade‐off between maintaining prudent public finances and securing voter support by analyzing the...

To evaluate the marginal welfare effects of taxation and of public spending, we must account for both distortionary and distributional effects. The distributional consequences of taxation, in terms of welfare, cannot be fully captured in in the measures currently used in the literature, such as...

This paper argues that the underprovision of public goods can be partly explained by lower demand from Indigenous groups with high preferences for Indigenous identity and a high capacity for coordination. Examining the post-Mexican Revolution period (1920s-1950s), when the state used the first...