Sustainability of Austrian Public Debt: A Political Economy Perspective

Gottfried Haber and Reinhard Neck ()

No 1816, CESifo Working Paper Series from CESifo

Abstract: Sustainablity of Austrian public debt is investigated in the context of political objectives such as stabilizing the business cycle, increasing chances for being re-elected and implementing the ideologies of political parties. Several tests indicate that Austrian fiscal policies were sustainable in the period 1960–1974, while from 1975 on, public debt grew much more rapidly. The development of public debt in Austria seems to be driven not primarily by ideology, but by structural causes and a shift in the budgetary policy paradigm. We find some empirical evidence that governments in Austria dominated by one party run higher deficits than coalition governments. There are no indications of a political business cycle.

Keywords: fiscal policy; sustainability; time series; political economy (search for similar items in EconPapers)
JEL-codes: E60 H60 (search for similar items in EconPapers)
Date: 2006
New Economics Papers: this item is included in nep-mac, nep-pbe and nep-pol
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Citations: View citations in EconPapers (16)

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Journal Article: Sustainability of Austrian public debt: a political economy perspective (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_1816

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