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Commitment Problems in Coalitions: A New Look at the Fiscal Policies Of Multiparty Governments*

  • Hanna Bäck and Johannes Lindvall

Abstract

Many political scientists and economists have argued that coalition governments tend to accumulate more debt than single-party governments do, but the evidence for this proposition is mixed. This article argues that only some coalition governments are more likely to increase public debt than single-party governments: those in which parties are unable to make credible promises to their partners about future policy. It introduces the concept of ‘commitment potential’ within coalitions and proposes a way of measuring it. The study evaluates its theoretical claims using data on 20 advanced democracies observed over a period of almost 50 years. It finds that multiparty governments with high commitment potential do not, on average, accumulate more debt than single-party governments, but that governments with low commitment potential do.

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*Hanna Bäck is Associate Professor of Political Science, Lund University, P.O. Box 52, 221 00 Lund, Sweden (hanna.back@svet.lu.se). Johannes Lindvall is Professor of Political Science, Lund University, P.O. Box 52, 221 00 Lund, Sweden (johannes.lindvall@svet.lu.se). We are very grateful to Despina Alexiadou, Michael Becher, Marius Busemeyer, Robert Franzese, Peter Santesson, and the PSRM reviewers and editors for very helpful comments on previous versions of this article. We also wish to thank Holger Döring and Albert Falcó-Gimeno for their advice and support when generating the data used in the article. Hanna Bäck acknowledges support from the Research Center (SFB) 884 ‘Political Economy of Reforms’ (Project C3), funded by the German Research Foundation (DFG). Johannes Lindvall acknowledges support from the European Research Council (Starting Grant No. 284313). To view supplementary material for this article, please visit http://dx.doi.org/10.1017/psrm.2014.11

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Commitment Problems in Coalitions: A New Look at the Fiscal Policies Of Multiparty Governments*

  • Hanna Bäck and Johannes Lindvall

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