Government spending and legislative organization: Quasi-experimental evidence from Germany
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Government spending and legislative organization : Quasi-experimental evidence from Germany. / Egger, Peter; Köthenbürger, Marko.
In: American Economic Journal: Applied Economics, Vol. 2, No. 4, 2010, p. 200-212.Research output: Contribution to journal › Journal article › Research › peer-review
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TY - JOUR
T1 - Government spending and legislative organization
T2 - Quasi-experimental evidence from Germany
AU - Egger, Peter
AU - Köthenbürger, Marko
N1 - JEL classification: D72, H72, R51
PY - 2010
Y1 - 2010
N2 - This paper presents empirical evidence of a positive effect of council size on government spending using a dataset of 2,056 municipalities in the German state of Bavaria over a period of 21 years. We apply a regression discontinuity design to avoid an endogeneity bias. In particular, we exploit discontinuities in the legal rule that relate population size of a municipality in order to council size to identify a causal relationship between council size and public spending, and find a robust positive impact of council size on spending. Moreover, we show that municipalities primarily adjust current expenditure in response to a rise in council size.
AB - This paper presents empirical evidence of a positive effect of council size on government spending using a dataset of 2,056 municipalities in the German state of Bavaria over a period of 21 years. We apply a regression discontinuity design to avoid an endogeneity bias. In particular, we exploit discontinuities in the legal rule that relate population size of a municipality in order to council size to identify a causal relationship between council size and public spending, and find a robust positive impact of council size on spending. Moreover, we show that municipalities primarily adjust current expenditure in response to a rise in council size.
KW - Faculty of Social Sciences
U2 - 10.1257/app.2.4.200
DO - 10.1257/app.2.4.200
M3 - Journal article
VL - 2
SP - 200
EP - 212
JO - American Economic Journal: Applied Economics
JF - American Economic Journal: Applied Economics
SN - 1945-7782
IS - 4
ER -
ID: 17523310