Testing the Buchanan-Wagner Hypothesis: European Evidence from Panel Unit Root and Cointegration Tests

According to the Buchanan-Wagnerhypothesis, public deficits reduce theperceived price of public goods to thecurrent generation of voters who, in turn,increase the demands for such socialservices. Several recent studies haveattempted to test this proposition. In thispaper, we apply modern time seriestechniques organized around panel unit rootand panel cointegration to draw sharperconclusions from the short time series thatare typically available. We find that thereis a long run positive relationship betweengovernment spending and government deficitsfor each country individually, as well asfor the panel as a whole. This providessupport for the BW hypothesis. We alsoanalyze the implications for the relativeproductivity performance of the public andprivate sector, the existence of scaleeconomies in the provision of publicservices, as well as the extent of crowdingout effects.     

The Size and Significance of the Pareto Set in Spatial Voting Models

The size of the Pareto set in the issue space of spatialvoting models is a function of the tax prices that voters arecharged. When all voters pay Lindahl prices for all goods, thePareto set collapses to a single point. The Pareto set can beenlarged by altering tax shares so they are further fromLindahl prices, and can be reduced by moving toward Lindahlpricing. A smaller Pareto set moves voters closer to consensuson issues, so reduces political decisionmaking costs and makesthe political system more stable.     

The Imprisonment Crisis in America: Introduction

This article provides an overview of recent trends in imprisonment rates in America and introduces the articles in this issue of The Review of Policy Research. Incarceration rates have increased by more than 500 percent since the early 1970s and have now reached a rate of almost 700, higher than anywhere else in the world. The impact has been particularly hard on racial minorities, especially women (whose incarceration rate went from around 8 in 1975 to 59 in 2001). The “war on drugs” has been one of the main reasons behind the increases in imprisonment, along with the more general “get tough on crime” movement that began in the late 1970s. The articles in this issue center around how this recent trend in incarceration impacts the entire society, but especially poor communities. Several of the articles focus on race, age and gender as important variables, in addition to the tendency of the parole system to sort of “recycle” released prisoners back into the prison system.