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The Effect of Governor Tenure on Local Expenditures: Focusing on Differences in Governor Attributes

Author

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  • Hidemasa Yoneoka

    (Associate Professor, Faculty of Regional Promotion, Nara Prefectural University)

  • Nobuo Akai

    (Professor, Osaka School of International Public Policy, Osaka University)

Abstract

Although many discussions have been held through previous research on the relationship between the length of a politician’s tenure and fiscal management, there is controversy about whether the impact is positive or negative. As much of the previous research analyzing fiscal management by Japan’s local governments involved verification based on data up till the early 2000s, it is also difficult to say if discussions have been conducted with due consideration for the changes surrounding the environment of local finances that occurred around 2000. The purpose of this research is to empirically clarify the relationship between a governor’s tenure and local expenditures by using panel data on prefectural governments from 1975 to 2017. To do so, we conducted an empirical analysis that focused on the possibility of differences in the relationship between local expenditures and a governor’s tenure before and after 2000, or on the possibility of differences in this relationship arising from the governor’s attributes and the timing when they assumed office. We drew the following three conclusions from the empirical analysis. Firstly, while the overall data (1975-2017) did not show that a longer tenure for the governor is related to greater restraint on local expenditures, this trend of restraint was identified for 2000 and after. It is inferred that this relationship was more strongly impacted by the enforcement of the Comprehensive Decentralization Law in 2000. This study also confirmed that the impact of the length of a governor’s tenure on local expenditures, observed for 2000 and after, gives rise to different effects depending on the attributes related to the governor’s background. Furthermore, it showed that the effects caused by differences in the governor’s background varied depending on whether a new governor assumed office after 2000. The conclusions drawn include several points that have not been elucidated in previous research to date or points that differ from the views presented in previous research, as well as several suggestions. Based on these results, there is a need to conduct more in-depth research in the future about the effects of the length of a governor’s tenure and how the related systems work.

Suggested Citation

  • Hidemasa Yoneoka & Nobuo Akai, 2023. "The Effect of Governor Tenure on Local Expenditures: Focusing on Differences in Governor Attributes," Public Policy Review, Policy Research Institute, Ministry of Finance Japan, vol. 19(2), pages 1-30, August.
    • Handle: RePEc:mof:journl:ppr19_02_04
    DOI: 10.57520/prippr.19-2-4
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    More about this item

    Keywords

    Restraints on local expenditures; Length of a governor’s tenure; Differences in governor’s attributes; Differences in timing for assumption of office;
    All these keywords.

    JEL classification:

    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures

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