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Political pressure and procyclical expenditure: An analysis of the expenditures of state governments in Mexico

Cabral, René; Palacios, Roberto; Cabral, Rene; Abbott, Andrew; Cabral Torres, René; Jones, Philip; Palacios-Rodrigues, Roberto

Authors

Philip Jones

Roberto Palacios-Rodrigues

René Cabral

Roberto Palacios

Abstract

© 2014 Elsevier B.V. Government expenditures are procyclical if they increase in periods of economic growth and decrease in periods of economic downturn. This paper tests the proposition that (within federations) political pressures for public expenditure increase the likelihood that expenditures and intergovernmental transfers will be procyclical. An analysis of political pressures in Mexico suggests that political pressures will produce a distinct pattern of procyclical expenditures across fiscal tiers and across government budgets. This prediction is tested with reference to the expenditures of 31 states in Mexico between 2005 and 2010.

Journal Article Type Article
Publication Date Mar 1, 2015
Journal European journal of political economy
Print ISSN 0176-2680
Publisher Elsevier
Peer Reviewed Peer Reviewed
Volume 37
Pages 195-206
DOI https://doi.org/10.1016/j.ejpoleco.2014.12.001
Keywords Business cycles, Fiscal policy, Voracity effects, Mexico, Latin-America
Publisher URL http://www.sciencedirect.com/science/article/pii/S0176268014001104
Additional Information This article is maintained by: Elsevier; Article Title: Political pressure and procyclical expenditure: An analysis of the expenditures of state governments in Mexico; Journal Title: European Journal of Political Economy; CrossRef DOI link to publisher maintained version: http://dx.doi.org/10.1016/j.ejpoleco.2014.12.001; Content Type: article; Copyright: Copyright © 2014 Elsevier B.V. All rights reserved.

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