The U.S. States

in Rules and Restraint

Published by University of Chicago Press

Published in print October 2007 | ISBN: 9780226682594
Published online March 2013 | e-ISBN: 9780226682617 | DOI:
The U.S. States

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This chapter, which analyzes the state spending outcomes and budgetary bargaining from three different perspectives to shed light on how budget rules shape fiscal practices in the states, also investigates the effect of balanced budget rules, reversion budgets, and other rules on spending in the U.S. states. It observes that states with strict balanced budget rules enforced by an external arbiter spend less than states without such rules. States with harsh reversion budgets, which take effect in the event of a stalemate, spend more than states with less severe reversion budgets. State-only spending is significantly smaller than state plus local spending. Strict balanced budget rules enforced by an elected high court lead to lower spending in the U.S. states. A balanced budget rule that does not allow for deficit carryover and that is subject to enforcement from an elected high court was shown to be effective at holding down spending.

Keywords: state spending; budgetary bargaining; budget rules; reversion budgets; U.S. states

Chapter.  8719 words. 

Subjects: US Politics

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