The political costs of tax increases and expenditure reductions: Evidence from state legislative turnover |
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Authors: | Sobel Russell S |
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Institution: | 1. Department of Economics, West Virginia University, Morgantown, WV, 26506-6025, U.S.A.
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Abstract: | This paper estimates the political costs of increasing taxes and cutting expenditures for members of a legislature. It is found that both costs are individually significant, but that they are not significantly different. This coincides with the first order condition for maximization of the probability of reelection. Republican legislatures have a higher political cost for taxes, thus the party's relative bias toward smaller government is founded in stronger constituent preferences against taxes, not for lower spending. Additionally, by being ideologically conservative, Republicans lower the political costs of taxes, while by being more liberal, Democrats lower the cost of cutting expenditures. |
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