Empirical examination of public debt sustainability in African economies: A panel data analysis

This study intends to investigate public debt sustainability across 29 Sub-Sahara African (SSA) economies, employing various econometric specifications, for the sampled years 1996–2020. The study employs Bohn's (Are stationarity and cointegration restrictions really necessary for the intertemporal budget constraint? Journal of monetary Economics, 54(7), pp.1837–1847.) framework of sustainability as the baseline model to assess public debt sustainability across the sampled Sub-Sahara African economies. As additional tests of public debt sustainability in order to support the baseline findings, the study also employs panel unit root and timeseries unit tests. The baseline findings from the OLS, panel quantile and instrumental panel quantile regressions show that public debt is sustainable across the panel of SSA economies. The positive and statistically significant response of primary balance under the Bohn's framework of sustainability manifest that the intertemporal budget constraint is not violated in the sampled economies. The consistency in the estimates under the OLS, panel quantile and instrumental panel quantile regressions also show that the estimates are robust throughout the estimation process. Also, utilizing the panel unit root test for public debt sustainability, the findings show that public debt is stationary over the sampled years which implies that intertemporal budget constraint holds and that public debt is sustainable across the sampled SSA economies. However, the timeseries analysis indicate that although majority of the SSA economies have sustainable public debt ratios, four countries namely Uganda, Sudan, Togo and Cote d'Ivoire have unsustainable public debt ratios. The study has important policy implications in terms of prudent public debt management and fiscal management for the sampled SSA economies.     

The evolution and current state of public affairs in Hungary

This paper discusses the recent developments in public affairs in Hungary from a historical perspective. The country's communist/socialist past and the relative novelty of the public affairs industry paint an interesting picture of the evolution and the direction of this field. The paper covers the political and economic processes starting from the transition period through recent events. Although there have been several promising developments in the area of public affairs and corporate lobbying during the last 20+ years, Hungary's increasingly anti-democratic policies, corruption scandals, and centralized decision-making processes have hindered the proper functioning of the public affairs profession and have limited the influence of corporations and interest groups in the country. Copyright © 2014 John Wiley & Sons, Ltd.     

Private Preferences for Public Goods: Towards a Model for the Interaction of Pressure Group and Electoral Politics

This essay explores two contrasting paradigms of collective action in the context of some observed anomalies in the development of the welfare states, focussing on private interest mod& of public expenditure growth versus models emphasising social choice and the degree of congruence between the political responsiveness of interest groups to the public expenditure crisis since the early 1970s, and the assumptions underpinning these models on political behaviour in the mixed economies. A bifurcation of the political system, resulting from the development of systems of functional interests representation alongside parliamentary and representative government, gives rise to a potential for strong governments to maintain regime support because of, rather than despite, the political fragmentation of majorities.     

The Public Purpose of Political Economy

ABSTRACT

For too long the discipline of political science has ceded research on the dynamics of the national political economy to the field of economics. In this article, we explore the cost of this cession in the context of the public purpose. Following John Kenneth Galbraith, we define the public purpose in terms of its independence from the market economy and the planning system. Political scientists, and especially political theorists, are uniquely qualified to theorize power relations relative to a host of challenges that have emerged in today’s rapidly transforming national economies. Galbraith’s critique of mainstream economics, coupled with his understanding of power as an inescapable and perpetual dialectical process, provide guidance for theorizations that should attend to rather than deny the contested domain of the public interest and collective good.     

Why feed the hand that bites you? Perceptions of procedural fairness and system support in post‐communist democracies

There is widespread agreement that bad governance and corruption represent daunting threats to new democracies and developing countries. Nonetheless, mainstream research on system support and political legitimacy has to a large extent overlooked the crucial importance of public perceptions of procedural fairness for fostering public support and regime legitimacy. Taking its departure in the theory of procedural fairness, this article challenges the conventional wisdom of earlier research by arguing and demonstrating that public perceptions of procedural fairness and impartiality on behalf of the authorities are the most important determinants of system support in the post‐communist European Union Member States. The empirical analysis lends strong support to the fact that perceptions of fairness and the extent of corruption exercise a strong effect on public support for the performance of the political system and approval of regime principles.     

Self-Interest, Ideological/Symbolic Politics, and Citizen Characteristics: A Cross-National Analysis of Support for Privatization

In this essay, the authors explore attitudes toward government privatization of electric utilities across two sets of nations: developed market economies (DMEs) and transition economies (TEs). They utilize generalized hierarchical linear model to analyze individual attitudes nested within these two groups of polities and discover a wide gap between the DME and TE nations in terms of preferences for privatization, with attitudes in DME nations being far more favorable. Attitudes toward the privatization of electricity are explained by a combination of ideological/symbolic predispositions, self-interest, and citizen values/characteristics. The most consistent variables in the model are the ideological/symbolic predispositions, while the weakest are citizen characteristics/values. In terms of self-interest, the analysis indicates that those who work for the public service or a public firm are more likely than others to oppose the privatization of electricity. In contrast to some public administration literature that asserts well-informed and interested citizens will oppose privatization, the authors find no convincing relationships. Instead, the most educated and politically efficacious citizens, as well as those who have confidence in the way democracy works within their nation, are more prone than others to support privatization of electricity.     

Interest group demand for taxation

Researchers have typically ignored the determinants of the tax structure of the public sector. Political scientists have concentrated their analyses on the expenditure side of the public ledgers while economists have avoided the issue by assuming that taxes are exogenously determined. In this paper we have shown that a behavioral model of political interest groups can be employed to gain insights into the political selection of taxes. The theory provides a general complement to the well-documented analysis of special interest demand for public expenditures.Our analysis raises several important policy questions. First, is the influence of interest groups on the determination of tax systems desirable from a public policy perspective? For example, special interest groups dominated by high and middle income individuals may prefer regressive tax systems which reduce their own tax burden. Certainly the impact of interest groups on the well-known regressivity of state and local tax systems is an area worthy of additional investigation.     

Can corruption foster regulatory compliance?

The legal and economic literatures overwhelmingly support the notion that regulatory compliance is always less in the presence of corruption. This paper departs from those literatures and shows that, whenever public officials are paid fixed wages, an increase in corruption may actually foster compliance. The conditions that make this possible are laid down in a theoretical model. Empirical evidence that corroborates the theoretical findings is provided using firm-level data for 26 transition economies.     

Towards a professional civil service in post‐transition Romania

To what degree and under what conditions can a young democracy build a competent, politically neutral public bureaucracy? A crucial component of the transition from communist party rule to democracy is the creation of a professional civil service. Success along this dimension of state‐building generates administrative capacity: non‐elected public officials ensure the implementation of reforms initiated by political leaders. In the communist party‐led regimes of Eastern Europe, forging this new administrative class from its highly politicised predecessor took place as new democracies sought to overcome historical legacies and integrate with the European Union. A case study of administrative reform in Romania during the post‐1989 period suggests the importance of external influences in forming a civil service more closely adhering to the Weberian ideal of an expert, rules‐based bureaucracy. Through analysis of survey data from a nationally representative sample of the Romanian civil servants, the public bureaucracy has professionalised insofar as educational and training credentials rather than political affiliation are significant predictors of salary levels. Copyright © 2009 John Wiley & Sons, Ltd.     

Determinants of government size: evidence from China

This paper investigates the determinants of government size at the provincial level in China. We employ the panel data model as a platform for empirical analysis and control for endogeneity in the study. Our study shows that openness to trade and foreign direct investment (FDI) may curtail government expansion, and that the provincial-level public sector is characterized by economies of scale. This study also documents that Wagner’s law does not hold true for China. Moreover, both expenditure decentralization and revenue decentralization contribute to the expansion of China’s government.     

Is the Median Voter a Clear-Cut Winner?: Comparing theMedian Voter Theory and Competing Theories in Explaining LocalGovernment Spending

This paper attempts to test the power of the median model againstthe respective strength of other alternate models based onredistributive, political-institutional and interest group theoriesin explaining the demand for public spending in New York statecounties during 1990, 1980 and 1970. To execute the comparison ofthe performance of median voter model with that of each of thenonmedian voter ones, various nonnested tests such as J and JAtests, N-tilde, W and encompassing tests have been employed.Results of the study show that although the median voter model hasa marginal edge over the rival models based on the alternativetheories, it may not be relied upon solely when many otherinstitutional, redistributive and interest group factors are alsorelevant for explaining public spending. The results of this studydiffer from those in Congleton and Bennett (1995). We do not findthat interest group models are substantially weaker than the medianvoter model.     

Being unequal and seeing inequality: Explaining the political significance of social inequality in new market democracies

Market economies inevitably generate social inequalities, of which the new democracies of Central and East European (CEE) societies have seen dramatic – though widely diverging – levels of growth. Do CEE citizens believe that inequality is excessive and, if so, why? And what is the connection between perceptions of social inequality and citizens' views of new markets and democracy? These questions are addressed using new data from mass surveys conducted in 2007 in 12 post‐communist CEE states. Surprisingly weak links are found between social inequality perceptions and national‐level measures of inequality as well economic, social and political conditions. Perceptions of social inequality are mainly driven by individual‐level assessments of market and democratic performance, but not by market or democratic ideals.     

Managerial efficiency in local government: Implications on jurisdictional consolidation

Using data from Maine, estimates of size economies in the production of public education services are provided under the alternative assumptions of managerial efficiency and inefficiency. While size economies were identified under the traditional assumption of managerial efficiency, limited or no size economies were identified under the more general assumption of managerial inefficiency. These results question the validity of the traditional economies of size literature and the jurisdictional consolidation policy which follows from the traditional literature.     

The political economy of unfunded public pension liabilities

This paper applies a public choice approach to the problem of unfunded pension liabilities and adopts the methodology of Congleton and Shughart (1990) to model underfunding of state-level public pension plans using the median voter theorem, along with the theory of “capture” by special interest groups, and a combined model of the two. With panel data from 2001 to 2009, the paper finds that the combined model provides the strongest explanation for the current levels of unfunded liabilities; hence, both median voter preferences and special interest group influence are affecting political outcomes. The special interest group model slightly outperforms the median voter model in direct comparisons.     

The West European communist movement in the late twentieth century

This article evaluates the impact of the collapse of communism in Eastern Europe on the West European communist movement. The state of the movement before 1989 is examined, followed by an analysis of the different trajectories of the parties after the revolutions and an assessment of their future prospects. It is argued that the momentous changes of 1989 have witnessed the passing of the West European communist tradition and that, while some communist parties live on, it is no longer fruitful to regard them and the ex‐communist parties as one ‘family’ or to study them under a common framework.     

The role of institutional and governance factors in public–private partnerships infrastructure investments in emerging economies

The overall development and sustained growth of any economy depend heavily on its infrastructure provisioning. Emerging economies are usually characterised by constrained public investments in infrastructure. Budgetary constraints of the governments are one of the major hurdles to these investments. Due to these reasons that governments of emerging economies continuously seek collaborations with the private sector for additional sources of funding infrastructure. Economies with solid institutional and governance frameworks are known to provide a conducive environment for enhanced private sector attraction in the sector. However, emerging economies face greater institutional and governance issues than developed economies, and they sometimes fall short of luring private investments in the infrastructure sector. The objective of this study is to empirically evaluate the role of institutional and governance aspects in private sector attraction in emerging economies. This study provides empirical evidence with a sample of 114 emerging economies over a period of 20 years. Various econometric estimates were developed to explore the interplay between public-private partnership investments and governance factors. The results of the study provide an evidence of a positive association between these factors and private investments in public-private partnership arrangements.     

Bureaucratic tenure and economic performance in centrally planned economies

Murrell and Olson (1991) set forth the hypothesis that in centrally planned economies economic interests over time become fragmented as bureaus become more autonomous and form into narrowly-based distributional coalitions. As a consequence, the national leader's encompassing interest in economic growth becomes compromised and growth begins to slow. This paper provides the first direct test of the hypothesis that growing bureaucratic autonomy results in declining economic growth in centrally planned economies.     

Stalinism as a Civilization: New Perspectives on Communist Regimes

A new line of inquiry into the history of communist regimes and the cold war has emerged. Pioneered by Stephen Kotkin and other American historians, it views Stalinism as the defining era of socialism, building a specific anti-capitalist and illiberal modernity that mustered voluntary participation and international legitimacy. This model of Stalinism as a rival civilization, held together by participatory totalitarianism, challenges older research on communist regimes – both revisionist and totalitarian studies. However, the degree of originality of this perspective is questioned here, citing precursors, parallels and contrasts within European research and political science.