Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/73139
Authors: 
Hayo, Bernd
Neumeier, Florian
Year of Publication: 
2013
Series/Report no.: 
Joint Discussion Paper Series in Economics 08-2013
Abstract: 
This paper empirically analyses the relationship between political leaders' socioeconomic backgrounds and public budget deficits utilising panel data on 21 OECD countries from 1980 to 2008. Building on sociological, as well as economic, research, we argue that the socioeconomic status of political decision-makers, i.e., presidents or prime ministers, is an important determinant of fiscal budget decisions. Our theory-consistent findings show that the tenures of lower-class leaders - i.e., leaders of low socioeconomic status - are associated with a deficit-to-GDP ratio which is 1.6 percentage points higher than that during tenures of upperclass leaders.
Subjects: 
budget deficit
political leaders
socioeconomic status
time preference
JEL: 
E62
H11
H62
Z13
Document Type: 
Working Paper

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