Sustainable Fiscal Policy in a Federal System: Switzerland as an Example
ISBN
1-4039-4798-8
Type
book section
Date Issued
2005-07-01
Author(s)
Editor(s)
Kriesi, Hanspeter
Farago, Peter
Kohli, Martin
Zarin-Nejadan, Milad
Abstract
How a sustainable fiscal policy can be performed in a federal system is not only a Swiss problem but is also discussed in other federal countries like Germany and Austria, and in the European Union. Contrary to most other countries, the Swiss Fiscal system is characterised by an extensive fiscal federalism with high fiscal autonomy at all govermental levels, by direct popular rights which include fiscal referenda at the cantonal and local levels, and by particular constitutional and/or statutory fiscal restraints in order to prevent excessive public debt. In this paper, the effects of these consitutional clauses on public finances are investigated. Using a panel of the 26 Swiss cantons from 1980 to 1998, we provide evidence that direct democracy leads to significantly lower expenditure and revenue. The fiscal constraint, on the other hand, significantly reduces budget deficits. Total, cantonal as well as local expenditure and revneue are the lower the higher the share of local expenditure is.
Language
English
Keywords
Direct Democracy
Referenda
Initiatives
HSG Classification
contribution to scientific community
Refereed
No
Book title
Contemporary Switzerland : Revisiting the Special Case
Publisher
Palgrave Macmillan
Publisher place
Basingstoke
Start page
281
End page
296
Pages
16
Subject(s)
Eprints ID
31596
File(s)![Thumbnail Image]()
Name
unisgdp200409.pdf
Size
293.12 KB
Format
Adobe PDF
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