Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/155552
Authors: 
Kauder, Björn
Potrafke, Niklas
Schinke, Christoph
Year of Publication: 
2017
Series/Report no.: 
CESifo Working Paper 6310
Abstract: 
We examine whether German state governments manipulated fiscal forecasts before elections. Our data set includes three fiscal measures over the period 1980-2014. The results do not show that electoral motives influenced fiscal forecasts in West German states. By contrast, East German state governments underestimated spending in pre-election years (compared to other years) by about 0.20 percent of GDP, tax revenues by about 0.36 percent of GDP, and net lending by 0.30 percent of GDP. Predicting low levels of spending and tax revenues, East German state governments thus underestimated the size of government in pre-election years.
Subjects: 
fiscal forecasts
electoral cycles
East and West Germany
JEL: 
H68
E32
E62
Document Type: 
Working Paper

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