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The Size and Composition of Government Spending in Multi-Party Systems

In: Essays on Government Growth

Author

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  • Carlos G. Scartascini

    (Inter-American Development Bank)

  • W. Mark Crain

    (Lafayette College)

Abstract

This paper explores the structure of party competition across democratic nations and its impact on the size and composition of government spending. The analytical framework expands on the norm of universalism, applies it to multi-party legislatures, and develops several propositions. We examine these propositions empirically using panel data for two samples, OECD countries and a large sample of world countries. The findings for both samples indicate that political fragmentation, usually measured by the number of effective political parties, has a positive relationship with the size of the government, and with subsidies and transfers. The findings also indicate that proportional representation (particularly closed lists proportional voting systems) and parliamentary countries favor higher public expenditures.

Suggested Citation

  • Carlos G. Scartascini & W. Mark Crain, 2021. "The Size and Composition of Government Spending in Multi-Party Systems," Studies in Public Choice, in: Joshua Hall & Bryan Khoo (ed.), Essays on Government Growth, chapter 0, pages 97-127, Springer.
    • Handle: RePEc:spr:stpchp:978-3-030-55081-3_6
    DOI: 10.1007/978-3-030-55081-3_6
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    Cited by:

    1. Keefer, Philip & Scartascini, Carlos & Vlaicu, Razvan, 2022. "Demand-side determinants of public spending allocations: Voter trust, risk and time preferences," Journal of Public Economics, Elsevier, vol. 206(C).
    2. Samuel K. Obeng, 2022. "On the determinants and interrelationship of components of government spending," Review of Development Economics, Wiley Blackwell, vol. 26(4), pages 2414-2435, November.

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