Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/86173
Authors: 
Suharnoko Sjahrir, Bambang
Kis-Katos, Krisztina
Schulze, Günther G.
Year of Publication: 
2013
Series/Report no.: 
Discussion Paper Series, University of Freiburg, Department of International Economic Policy 23
Abstract: 
We study political business cycles (PBC) in newly democratized and decentralized Indonesia at the local level. As the timing of indirect and later on direct elections of district heads differs exogenously across jurisdictions, the political business cycle effect is clearly identified . Our data allow distinguishing PBCs for indirect and direct elections. We find significant budget cycles for discretionary budget categories at the disposal of the district head (not for the overall budget) only for direct elections, not for indirect elections. These cycles are much larger if the incumbent runs for reelection. Our results underline the conditional nature of PBC.
Subjects: 
Political business cycles
Indonesia
local elections
direct and indirect elections
JEL: 
H72
H76
Document Type: 
Working Paper

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