Political Budget Cycles: The Case of the Western German Länder

This paper focuses on the issue of the electoral andideological cycles in state government budget for the elevenWestern German Länder. We verify this hypothesis over theperiod 1974–1994 for the following budgetary variables: totalexpenditures, surplus/deficit, administration, health care,education, roads and social security benefits. While overallour results seem to show that generally the party variabledoes not play a systematic role in spending decisions, theyprovide some support to the opportunistic cycle theory showingthat the only relevant phenomenon is the effect of theupcoming election on the government spending inclinations.