This paper summarizes theoretical models and empirical evidence concerning political economy of public finances. It emphasizes political and institutional issues that influence different levels of public debt and fiscal deficits in countries and subnational entities with similar economic...

Some recent articles debate the implications of the results of experimental economics. It is claimed by some that these results challenge the assumptions of expected utility theory. Others deny this. Both sides presume that the assumptions of rationality or expected utility-maximization are...