Arbeitspapier
The Effect of Fiscal Rules on Public Investment if Budget Deficits are Politically Motivated
Uncertainty about the future preferences of the government may induce policy makers to run excessive budget deficits. As a solution to this problem, economists have proposed to impose a binding debt rule. In this paper we argue that a binding debt rule does not eliminate the distortions due to strategic behaviour of politicians. Rather, strategic manipulation shifts from public debt to public investment. As an alternative, we examine the effects of a capital borrowing rule which permits the government to run a budget deficit equal to the amount of public investment. We show that this rule effectively eliminates strategic behaviour.
- Sprache
-
Englisch
- Erschienen in
-
Series: Tinbergen Institute Discussion Paper ; No. 97-125/1
- Klassifikation
-
Wirtschaft
Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
Fiscal Policy
National Budget; Budget Systems
National Deficit; Surplus
- Thema
-
fiscal rules
budget deficits
public investment
Öffentliche Investition
Haushaltsdefizit
Finanzpolitik
Theorie
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Dur, Robert A.J.
Peletier, Ben D.
Swank, Otto H.
- Ereignis
-
Veröffentlichung
- (wer)
-
Tinbergen Institute
- (wo)
-
Amsterdam and Rotterdam
- (wann)
-
1997
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:43 MEZ
Datenpartner
Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Dur, Robert A.J.
- Peletier, Ben D.
- Swank, Otto H.
- Tinbergen Institute
Entstanden
- 1997
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