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https://doi.org/10.12924/cis2015.03010001
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Sustainability of Fiscal Policy in Democracies and Autocracies
[journal article]
Abstract This paper tries to identify the fiscal sustainability record of democratically and autocratically governed countries by applying various performance indicators (credit worthiness, payment defaults, national debt, foreign assets) and also to clarify what effect the characteristics of a regime have o... view more
This paper tries to identify the fiscal sustainability record of democratically and autocratically governed countries by applying various performance indicators (credit worthiness, payment defaults, national debt, foreign assets) and also to clarify what effect the characteristics of a regime have on consolidation efforts in a country. The study identifies two key findings. While in the past, democracies have clearly found it easier to preserve their credit standing and solvency and to avoid government bankruptcy, a similar advantage can no longer be detected for democracies in terms of reducing national debt and foreign debts. Why democracies, in spite of their arrangements with a sensitivity for the public good and for due process, are finding it so difficult to avoid shifting their debts to future generations, to undertake cutback measures and to provide sufficient financial foresight, can in principle be interpreted as the other side of the coin, namely highly presence-oriented interests boosted even further through the short "democracy-specific time horizon".... view less
Keywords
budget consolidation; dictatorship; sustainability; national debt; solvency; democracy; political system; inflation; fiscal policy; tax revenue; austerity policy
Classification
Political System, Constitution, Government
Economic Policy
Document language
English
Publication Year
2015
Page/Pages
p. 1-15
Journal
Challenges in Sustainability, 3 (2015) 1
ISSN
2297-6477
Status
Published Version; peer reviewed