Voting on the budget deficit

This paper analyzes a model in which a group of rational individuals votes over the composition and time profile of public spending. All voters agree that a balanced budget is ex ante optimal. However, if there is disagreement between current and future majorities, a balanced budget is not a politic...

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Bibliographic Details
Main Authors: Tabellini, Guido, Alesina, Alberto
Format: Book
Published: Nashville American Economic Association March 1990
Series:American Economic Review n. 1
Subjects:
Description
Summary:This paper analyzes a model in which a group of rational individuals votes over the composition and time profile of public spending. All voters agree that a balanced budget is ex ante optimal. However, if there is disagreement between current and future majorities, a balanced budget is not a political equilibrium under majority rule. Under certain conditions a majority of the voters favors a budget deficit, and the equilibrium deficit it larger the greater is the polarization among voters.
Physical Description:pp. 37-49 il.
Bibliography:Incluye bibliografía
ISSN:00028282