Skip to main content
SpringerLink
Log in

Educational business cycles

The political economy of teacher hiring across German states, 1992–2004

  • Published:
Public Choice Aims and scope Submit manuscript

Abstract

Strong institutional constraints and better-informed voters may lead re-election seeking incumbents to shift the use of political business cycle mechanisms away from monetary and fiscal policy towards other policy domains that are more easily manipulable, targetable, and timeable. We investigate teacher employment patterns at the state level in Germany and find strong evidence of cycling mechanisms, in the form of electioneering and honeymooning. Against a backdrop of a continuously shrinking total teachers’ pool, German state-level incumbents accelerate the hiring of new teachers during election periods and partly reverse this during politically safer points in the electoral cycle. Cycles are mediated by issue salience: heightened attention to German public schooling after the notorious PISA-2000 tests further strengthens the manipulation of new teacher hiring for electoral purposes.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  • Alesina, A., Cohen, G., & Roubini, N. (1993). Electoral business cycles in industrial democracies. European Journal of Political Economy, 23, 1–25.

    Article  Google Scholar 

  • Allmendinger, J., & Leibfried, S. (2003). Education and the welfare state: The four worlds of competence production. Journal of European Social Policy, 13(1), 63–81.

    Article  Google Scholar 

  • Alt, J. E., & Lassen, D. D. (2006). Transparency, political polarization, and political budget cycles in OECD countries. American Journal of Political Science, 50(3), 530–550.

    Article  Google Scholar 

  • Anderson, T. W., & Hsiao, C. (1982). Formulation and estimation of dynamic models using panel data. Journal of Econometrics, 18, 47–82.

    Article  Google Scholar 

  • Arellano, M., & Bond, S. (1991). Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Review of Economic Studies, 58, 277–297.

    Article  Google Scholar 

  • Baltagi, B. (2001). Econometric analysis of panel data, 2nd ed. New York: Wiley.

    Google Scholar 

  • Benz, A. (1999). From unitary to asymmetric federalism in Germany: Taking stock after 50 years. Journal of Federalism, 29(4), 55–78.

    Google Scholar 

  • Berger, H., & Woitek, U. (1997). Searching for political business cycles in Germany. Public Choice, 91(2), 179–197.

    Article  Google Scholar 

  • Boix, C. (1997). Political parties and the supply side of the economy: The provision of physical and human capital in advanced economies, 1960–1990. American Journal of Political Science, 41(3), 814–845.

    Article  Google Scholar 

  • Bruno, G. S. F. (2004). Approximating the bias of the LSDV estimator for dynamic unbalanced panel data models. Universita Commerciale Luigi Bocconi, Working Paper No. 159.

  • Bruno, G. S. F. (2005). Estimation and inference in dynamic unbalanced panel data models with a small number of individuals. Universita Commerciale Luigi Bocconi, Working Paper No. 165.

  • Bundesamt (2005). Schulstatistik. Wiesbaden: Statistisches Bundesamt.

    Google Scholar 

  • Bundesamt (2006). Arbeitskreis fuer Volkswirtschaftliche Gesamtrechung. Wiesbaden: Statistisches Bundesamt.

    Google Scholar 

  • Bundeswahlleiter (2005). Wahl zum 16. Deutschen Bundestag am 18. September 2005. Wiesbaden: Statistisches Bundesamt.

    Google Scholar 

  • Busemeyer, M. (2007). Determinants of public education spending in 21 OECD democracies, 1980–2001. Journal of European Public Policy, 14(4), 582–610.

    Article  Google Scholar 

  • Drazen, A. (2000). The political business cycle after 25 years. NBER Macroeconomics Annual, 15, 75–117.

    Article  Google Scholar 

  • Falch, T., & Rattso, J. (1997). Political economic determinants of school spending in federal states: Theory and time-series evidence. European Journal of Political Economy, 13, 299–314.

    Article  Google Scholar 

  • FAZ (2000). Mit PISA soll die Leistung von Schülern geprüft werden. GEW lehnt das Programm zum Leseverständnis ab/Konferenz der Kultusminister. Frankfurter Allgemeine Zeitung, 64(16), 4.

    Google Scholar 

  • FAZ (2001a). Belehrte Unwissenheit: Die PISA-Studie: Welche Schulen, welche Lehrer hat das Land? Frankfurter Allgemeine Zeitung, 284(9), 49.

    Google Scholar 

  • FAZ (2001b). Das kannst du doch! Oder? Laut “PISA”-Studie versagen die Schulen.Viele Eltern verlassen sich deshalb lieber auf Begabungstests für ihre Kinder. Frankfurter Allgemeine Zeitung, 49(9), 55.

    Google Scholar 

  • FAZ (2001c). Ein heilsamer Schock. Wie die Bundesländer auf die schlechten Ergebnisse der PISA-Studie reagieren wollen. Frankfurter Allgemeine Zeitung, 285(7), 5.

    Google Scholar 

  • Fernandez, R., & Rogerson, R. (1997). The determinants of public education expenditure: Evidence from the states, 1950–1990. NBER Working Paper Series, 5995.

  • Franzese, R. (2000). Electoral and partisan manipulation of public debt in developed democracies, 1956–1990. In R. Strauch, & J. Hagen (Eds.), Institutions, politics and fiscal policy (pp. 61–83). Dordrecht: Kluwer Academic.

    Google Scholar 

  • Franzese, R., & Jusko, K. L. (2006). Political-economic cycles. In D. Wittman & B. Weingast (Eds.), Oxford handbook of political economy (pp. 545–586). Oxford: Oxford University Press.

    Google Scholar 

  • Galli, E., & Rossi, S. (2002). Political budget cycles: The case of Western German Laender. Public Choice, 110(3), 283–303.

    Article  Google Scholar 

  • Hanushek, E. A. (2003). The failure of input-based schooling policies. Economic Journal, 113(485), 64–98.

    Article  Google Scholar 

  • Hausman, J. A. (1978). Specification tests in econometrics. Econometrica, 46, 1251–1271.

    Article  Google Scholar 

  • Hesse, K. (1962). Der unitarische Bundesstaat. Karlsruhe: C.F. Müller.

    Google Scholar 

  • Hibbs, D. (1977). Political parties and macroeconomic policy. American Political Science Review, 71(4), 1467–1487.

    Article  Google Scholar 

  • Hibbs, D. (2006). Voting and the macroeconomy. In D. Wittman & B. Weingast (Eds.), Oxford handbook of political economy (pp. 565–586). Oxford: Oxford University Press.

    Google Scholar 

  • Jochimsen, B., & Nuscheler, R. (2006). The political economy of the German Laender deficits. Berlin: WzB Discussion Paper SP II 2007–06.

  • Judson, R., & Owen, A. L. (1997). Estimating dynamic panel data models: A practical guide for macroeconomists. Federal Reserve Board of Governors, Finance and Economics Discussion Series 1997-3, Washington DC.

  • Judson, R. A., & Owen, A. L. (1999). Estimating dynamic panel data models: A guide for macroeconomists. Economics Letters, 65, 9–15.

    Article  Google Scholar 

  • Keefer, P. (2007). Clientelism, credibility, and the policy choices of young democracies. American Journal of Political Science, 51(4), 804–821.

    Article  Google Scholar 

  • Kiviet, J. (1995). On bias, inconsistency, and efficiency of various estimators in dynamic panel data models. Journal of Econometrics, 68, 53–78.

    Article  Google Scholar 

  • Kultusministerkonferenz (2005). Einstellung von Lehrkraeften 2004. Koeln: Kultusministerkonferenz.

    Google Scholar 

  • Lewis-Beck, M., & Paldam, M. (2000). Economic voting: an introduction. Electoral Studies, 19, 113–121.

    Article  Google Scholar 

  • Nannestad, P., & Paldam, M. (1994). The VP-function: A survey of the literature on vote and popularity functions after 25 years. Public Choice, 79, 213–245.

    Article  Google Scholar 

  • Nickell, S. J. (1981). Biases in dynamic models with fixed effects. Econometrica, 49, 1417–1426.

    Article  Google Scholar 

  • Nordhaus, W. (1975). The political business cycle. Review of Economic Studies, 42(2), 169–190.

    Article  Google Scholar 

  • Oberndorfer, U., & Steiner, V. (2006). Intergenerational conflict, partisan politics, and public higher education spending: Evidence form the German States. IZA Discussion Paper 2417.

  • PISA-Konsortium Deutschland (2005). PISA 2003 Der zweite Vergleich der Länder in Deutschland—Was wissen und können Jugendliche? Muenster: Waxmann.

    Google Scholar 

  • Potrafke, N. (2006). Parties matter in allocation expenditures: Evidence from Germany. DIW Discussion Paper 652.

  • Pritchett, L., & Filmer, D. (1999). What education production functions. really show: A positive theory of education expenditures. Economics of Education Review, 18, 223–239.

    Article  Google Scholar 

  • Scharpf, F. (2005). No exit from the joint decision trap? Can German federalism reform itself? EUI Working Paper, RSCAS No. 2005/24.

  • Schmidt, M. G. (2006). Bildungsausgaben im inter—und intranationalen Vergleich. Lehrstuhldatenbank, University of Heidelberg.

  • Seitz, H. (2000). Fiscal policy, deficits and politics of subnational governments: The case of the German Laender. Public Choice, 102(3), 183–218.

    Article  Google Scholar 

  • Shi, M., & Svensson, J. (2006). Political budget cycles: Do they differ across countries and why? Journal of Public Economics, 90(8–9), 1367–1389.

    Article  Google Scholar 

  • Stettes, O. (2007). Die föderale Ordnung im Bildungswesen: Eine Analyse aus bildungsökonomischer Perspektive. In Institut der deutschen Wirtschaft Köln (Eds.), Föderalismus in Deutschland (pp. 101–130). Köln: Deutscher Instituts-Verlag.

    Google Scholar 

  • Tufte, E. (1978). Political control of the economy. Princeton: Princeton University Press.

    Google Scholar 

  • Vanhuysse, P. (2002). Efficiency in politics: Competing economic approaches. Political Studies, 50(1), 136–149.

    Article  Google Scholar 

  • Vanhuysse, P., & Sulitzeanu-Kenan, R. (2009). Teacher’s PAT? Multiple-role principal-agent theory, education politics, and the power of bureaucrats, forthcoming. Critical Studies in Education, 50(1).

Download references

Author information

Authors and Affiliations

  1. School of Business & Economics, Free University Berlin, Garystr. 21, 14195, Berlin, Germany

    Markus Tepe

  2. School of Political Sciences and Faculty of Education, University of Haifa, Mt Carmel 31905, Haifa, Israel

    Pieter Vanhuysse

Authors
  1. Markus Tepe
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Pieter Vanhuysse
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Markus Tepe.

Additional information

Equal authors, listed alphabetically.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Tepe, M., Vanhuysse, P. Educational business cycles. Public Choice 139, 61–82 (2009). https://doi.org/10.1007/s11127-008-9379-6

Download citation

  • Received:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s11127-008-9379-6

Keywords

JEL Classification

Search

Navigation