Abstract
We analyze amodel where local public debt levels are set by politicians who are chosen in local elections. Migration causes an externality across districts, and leads to overaccumulation of local public debt. Since debt is a strategic substitute, the median voters in each district prefer shortsighted political leaders who "borrow and spend," thereby exacerbating the problem of overaccumulation of local public debt.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 655-674 |
| Number of pages | 20 |
| Journal | Journal of Public Economic Theory |
| Volume | 6 |
| Issue number | 5 |
| DOIs | |
| State | Published - Dec 1 2004 |
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All Science Journal Classification (ASJC) codes
- Finance
- Sociology and Political Science
- Economics and Econometrics
Cite this
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Public debt, migration, and shortsighted politicians. / Schultz, Christian; Sjostrom, John.
In: Journal of Public Economic Theory, Vol. 6, No. 5, 01.12.2004, p. 655-674.Research output: Contribution to journal › Article
TY - JOUR
T1 - Public debt, migration, and shortsighted politicians
AU - Schultz, Christian
AU - Sjostrom, John
PY - 2004/12/1
Y1 - 2004/12/1
N2 - We analyze amodel where local public debt levels are set by politicians who are chosen in local elections. Migration causes an externality across districts, and leads to overaccumulation of local public debt. Since debt is a strategic substitute, the median voters in each district prefer shortsighted political leaders who "borrow and spend," thereby exacerbating the problem of overaccumulation of local public debt.
AB - We analyze amodel where local public debt levels are set by politicians who are chosen in local elections. Migration causes an externality across districts, and leads to overaccumulation of local public debt. Since debt is a strategic substitute, the median voters in each district prefer shortsighted political leaders who "borrow and spend," thereby exacerbating the problem of overaccumulation of local public debt.
UR - http://www.scopus.com/inward/record.url?scp=55149101913&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=55149101913&partnerID=8YFLogxK
U2 - 10.1111/j.1467-9779.2004.00185.x
DO - 10.1111/j.1467-9779.2004.00185.x
M3 - Article
AN - SCOPUS:55149101913
VL - 6
SP - 655
EP - 674
JO - Journal of Public Economic Theory
JF - Journal of Public Economic Theory
SN - 1467-9779
IS - 5
ER -