Ideological polarization and government debt

Mickael Melki; Andrew Christopher Pickering

doi:10.1007/s10797-021-09690-1

Ideological polarization and government debt

Mickael Melki, Andrew Christopher Pickering

Economics

Research output: Contribution to journal › Article › peer-review

Abstract

Models of strategic debt predict that public debt increases with polarization, measured by the ideological distance between the government and its likely successor. Conversely if voters are both short-termist and also more likely to switch their vote for parties offering higher spending and public good provision when the electorate is ideologically concentrated, then debt can fall with polarization, measured by dispersion of ideological preferences in the electorate. Using time-varying polarization measures generated from ideology data from party manifestos, we find a sizable and statistically significant negative association between debt levels in OECD countries and ideological polarization in the electorate.

Original language	English
Pages (from-to)	811–833
Number of pages	23
Journal	International tax and public finance
Volume	29
Early online date	30 Aug 2021
DOIs	https://doi.org/10.1007/s10797-021-09690-1
Publication status	Published - 1 Aug 2022

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Melki-Pickering2021_Article_IdeologicalPolarizationAndGove
© The Author(s) 2021
Final published version, 1.02 MBLicence: CC BY

Cite this

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