Ratio Working Papers
Working paper No. 240 Bloc – party Politics and Economic Outcomes. What Are the Effects of Local Parties?
() and Martin Korpi
Abstract: In a much cited 2008 article, Per Pettersson-Lidbom uses
regression discontinuity to test for Swedish party effects on economic
policies such as municipal taxation, spending and employment. We reassess
the issue using the same estimator as Pettersson-Lidbom but new data on all
factual coalitions, including minority coalitions as well as those
previously deemed as undefined on a left and right wing political scale
(constituting about 20 percent of the sample used in Pettersson-Lidbom’s
study). This makes it possible to remove a systematic bias against
centre-right coalitions in Pettersson-Lidbom’s study. We find that a
majority of the previous findings stand, with sometimes even slightly
stronger effects, but not as regards the proportional income tax rate and
number of government employees per capita. Parties seem to matter for
economic outcomes, but not always, and some parties more than others.
Keywords: Democracy; Voting behaviour; Economic policy; Political systems; (follow links to similar papers)
JEL-Codes: C21; D72; D78; H71; H72; (follow links to similar papers)
16 pages, December 31, 2014
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