TY  - JOUR
AU  - Brender,Adi
AU  - Drazen,Allan
TI  - Do Leaders Affect Government Spending Priorities?
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 15368
PY  - 2009
Y2  - September 2009
UR  - http://www.nber.org/papers/w15368
L1  - http://www.nber.org/papers/w15368.pdf
N1  - Author contact info:
Adi Brender
Research Department
Bank of Israel
Jerusalem 91007
ISRAEL
E-Mail: adib@bankisrael.gov.il

Allan Drazen
Department of Economics
University of Maryland
College Park, MD 20742
Tel: 301/405-3477
Fax: 301/405-7835
E-Mail: drazen@econ.umd.edu
AB  - Since a key function of competitive elections is to allow voters to express their policy preferences, one might take it for granted that when leadership changes, policy change follows. Using a dataset we created on the composition of central government expenditures in a panel of 71 democracies over 1972-2003, we test whether changes in leadership induce significant changes in spending composition, as well as looking at the effect of other political and economic variables. We find that the replacement of a leader tends to have no significant effect on expenditure composition in the short-run. This remains true after controlling for a host of political and economic variables. However, over the medium-term leadership changes are associated with larger changes in expenditure composition, mostly in developed countries. We also find that in established democracies, election years are associated with larger changes in expenditure composition while new democracies, which were found by Brender and Drazen (2005) to raise their overall level of expenditures in election years, tend not to have such changes.
ER  -