Does political fragmentation lead to budgetary incrementalism? An empirical test on the French local public sector

摘要

This paper tests for the impact of political fragmentation on the volatility of public expenditures. Two different empirical strategies are implemented using the per capita operating expenditures of 90 French local jurisdictions (the departements) for an 8-year period. The first strategy focuses directly on the impact of the electoral margin, the fragmentation of the majority and the concentration of the opposition on the annual budget growth rates. The second strategy regresses the present expenditures on last year's expenditures over several subsamples. Both empirical strategies lead to the following conclusions. First, the less powerful a majority in terms of seats and fragmentation, the lower the annual fluctuations of the budget. Second, highly powerful majorities are not always associated with the highest budgetary growth rates.