Please use this identifier to cite or link to this item:
Title: Minority governments and budget deficits: The role of the opposition
Author: Falcó Gimeno, Albert
Jurado, Ignacio
Keywords: Minories
Oposició (Ciències polítiques)
Opposition (Political science)
Issue Date: 2011
Publisher: Elsevier
Abstract: When governments are in a parliamentary minority they have to negotiate with opposition parties over the annual budget. We argue that, as a consequence, the preferences of the opposition concerning fiscal outcomes should be reflected in the yearly budget balances. We present a theoretical argument in which the opposition faces a trade-off. It has a short-term interest in deficits since they can signal a weak government, but a long-term aversion to them because, if they reach office, they will have to deal with the burden of increased debt. Empirically, we find that opposition parties affect deficit outcomes depending on their probability of governing in the next term and the weakness of the incumbent government. When the opposition is mainly concentrated in one party, it is likely that it will take over the government and this will make the opposition deficit-averse in the current period. However, if the minority government is a coalition, then a concentrated opposition might see deficits as an opportunity to reach office earlier and might be willing to pass budgets with deficit.
Note: Versió postprint del document publicat a:
It is part of: European Journal of Political Economy, 2011, vol. 27, num. 3, p. 554-565
Related resource:
ISSN: 0176-2680
Appears in Collections:Articles publicats en revistes (Ciència Política, Dret Constitucional i Filosofia del Dret)

Files in This Item:
File Description SizeFormat 
613836.pdf278.8 kBAdobe PDFView/Open

Items in DSpace are protected by copyright, with all rights reserved, unless otherwise indicated.