Fiscal policy institutions and history

  1. David Cuberes Vilalta
  2. Andrew Mountford
Journal:
Working papers = Documentos de trabajo: Serie AD

Year of publication: 2012

Issue: 2

Pages: 1-11

Type: Working paper

Abstract

This paper shows that historical variables can explain a significant part of discretionary government spending across countries. We argue that these results provide evidence in favor of Besley and Persson’s (2009) hypothesis that institutional quality or state capacity is historically determined and further that institutional quality determines, in part, economic policy.