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Fiscal Transparency, Gubernatorial Approval, and the Scale of Government: Evidence from the States

Published online by Cambridge University Press:  25 January 2021

James E. Alt ,
David Dreyer Lassen  and
David Skilling
James E. Alt
Affiliation:
Harvard University
David Dreyer Lassen
Affiliation:
University of Copenhagen
David Skilling
Affiliation:
The Treasury, New Zealand
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Abstract

We explore the effect of the transparency of fiscal institutions in government on the scale of government and gubernatorial approval using a formal model of accountability. We construct an index of fiscal transparency for the American states from detailed budgetary information. With cross-sectional data for 1986-95, we find that—on average and controlling for other factors—fiscal transparency increases both the scale of government and gubernatorial approval. Our results imply that more transparent fiscal institutions induce greater effort by politicians, to whom voters give higher job approval, on average. Voters also respond by entrusting greater resources to politicians where fiscal institutions are more transparent, leading to larger government.

Type
Research Article
Information
State Politics & Policy Quarterly , Volume 2 , Issue 3 , Fall 2002 , pp. 230 - 250
Copyright
Copyright © The American Political Science Association, 2002

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