The size and scope of government in the US states: does party ideology matter?
- 608 Downloads
We investigate empirically how party ideology influences size and scope of government as measured by the size of government, tax structure and labor market regulation. Our dataset comprises 49 US states over the 1993–2009 period. We employ the new data on the ideological mapping of US legislatures by Shor and McCarty (Am. Polit. Sci. Rev. 105(3):530–551, 2011) that considers spatial and temporal differences in Democratic and Republican Party ideology. We distinguish between three types of divided government: overall divided government, proposal division and approval division. The main result suggests that Republican governors have been more active in deregulating labor markets. We find that ideology-induced policies were counteracted under overall divided government and proposal division.
KeywordsSize and scope of government Political ideology US states
JEL ClassificationD72 H70 H11
We are grateful for comments from Felix Bierbrauer, Francois Facchini, Alexander Fink, Martin Hellwig, David Dreyer Lassen, Leandro de Magalhaes, Mikaël Melki, Fabio Padovano, Martin Rode, Mark Schelker, Jim Snyder, Christian Traxler, Heinrich Ursprung and participants of the 2010 meetings of the Public Choice Society, the 2010 meetings of the European Public Choice Society, the 2010 Silvaplana Workshop on Political Economy, the 2011 meetings of the Public Choice Society, the 2011 meetings of the European Association of Law and Economics, the 2012 meetings of the International Institute of Public Finance and seminars at University of Lucca, the Max Planck Institute for Research on Collective Goods in Bonn, the University Paris 1, Lund University, the University of Freiburg, the ifo Institute, the University of Siegen, the University of Leicester, and the University of Augsburg. We also thank state budget offices for help, in particular Paul Potamianos (Connecticut), Sheila Peterson (North Dakota), Kristin Keith (Oregon) and Samantha Smithingell (Washington). Henrik Pedersen, Margret Schneider and Christian Simon provided excellent research assistance.
- Alesina, A., Roubini, N., & Cohen, G. D. (1997). Political cycles and the macroeconomy. Cambridge: MIT Press. Google Scholar
- Broz, J. L. (2011). The United States Congress and IMF financing, 1944–2009. Review of International Organizations, 6(3–4), 341–368. Google Scholar
- Bueno, A., Ashby, N. J., McMahon, F., & Martinez, D. (2012). Economic freedom of North America 2012. Frazer Institute. Google Scholar
- Calcagno, P. T., & Lopez, E. J. (2012). Divided we vote. Public Choice, 151(3–4), 405–431. Google Scholar
- Frederiksson, P. G., Wang, L., & Warren, P. L. (2013, forthcoming). Party politics, governors and economic policy. Southern Economic Journal. Google Scholar
- Garrett, T. A., & Rhine, R. M. (2011). Economic freedom and employment growth in the U.S. states. Review - Federal Reserve Bank of St. Louis, 93, 1–18. Google Scholar
- Gerring, J. (1997). Ideology: a definitional analysis. Political Research Quarterly, 50(4), 957–994. Google Scholar
- Gwartney, J., Lawson, R., & Block, W. (1996). Economic freedom of the world: 1975–1995. Vancouver: The Fraser Institute. Google Scholar
- Gwartney, J., Lawson, R., Grubel, H., De Haan, J., Sturm, J. E., & Zandberg, E. (2009). Economic freedom of the world: 2009 annual report. Vancouver: The Fraser Institute. Google Scholar
- Huber, P. J. (1967). The behavior of maximum likelihood estimates under nonstandard conditions. In Proceedings of the fifth Berkeley symposium on mathematical statistics and probability (pp. 221–233). Google Scholar
- Imbeau, L. L. M., Pétry, F., & Lamari, M. (2001). Left-right party ideology and government policies: a meta-analysis. European Journal of Political Research, 40(1), 1–29. Google Scholar
- Kauder, B., & Potrafke, N. (2013, forthcoming). Government ideology and tuition fee policy: evidence from the German states. CESifo Economic Studies. Google Scholar
- Larcinese, V., Snyder, J. M. Jr., & Testa, C. (2013, forthcoming). Testing models of distributive politics using exit polls to measure voters’ preferences and partisanship. British Journal of Political Science. Google Scholar
- Pew Center (2010). Public’s priorities for 2010: economy, jobs, terrorism (Report). The Pew Research Center Washington DC, January 25. Google Scholar
- Pickering, A., & Rockey, J. (2013, forthcoming). Ideology and the size of US state government. Public Choice. Google Scholar
- Poole, K. T., & Rosenthal, H. (2007). Ideology and Congress. Piscataway: Transaction Publishers. Google Scholar