Votingon the "Optimal" Size of Government

Author/Editor:

Jan-Peter Olters

Publication Date:

October 1, 2000

Electronic Access:

Free Download. Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

Viewing fiscal policies as the outcome of democratically resolved conflicts of households over public goods and taxes, the “economic model of politics” proposes a public choice approach, which does not rely on social welfare functions. With it, a country’s overall budget can be derived endogenously, electoral fluctuations explained on the basis of changes to the individuals’ income and wealth, and political behavior described in terms of the individuals’ decisions regarding votes, abstentions, and party membership. The model suggests that a country’s wealth distribution is a crucial variable affecting its economic stability and the government’s size relative to output.

Series:

Working Paper No. 2000/174

Subject:

Capital income Consumption Expenditure Income Income tax systems

English

Publication Date:

October 1, 2000

ISBN/ISSN:

9781451858686/1018-5941

Stock No:

WPIEA1742000

Pages:

22

Please address any questions about this title to publications@imf.org