Employing cluster analysis, this article reconsiders a concept formulated by Francis G. Castles that stresses the existence of four families of nations, which markedly differ in respect of public policy-making. For two policy fields - social and economic policy - the hypothesised families of nations can be shown to exist, and they are quite robust and stable over time. Cluster analysis also reveals different paths towards modernity. On the one hand, there are more state-oriented versus more market-oriented models of public policy-making; on the other, there is a cleavage in public policy-making between rich countries located at the centre and somewhat poorer countries located at the periphery.

What is the impact of direct democracy, e.g. referendums, on public policymaking? The study will present data for Switzerland, the United States, Australia and Germany leading to the conclusion that direct democracy is an effective, but flexible veto player against expansive spending and taxation. The level of public expenditure and taxation is significantly lower in countries that have elements of direct democracy compared to pure representative democracies. Several theoretical arguments support this finding. For example, the social discount rate of voters is lower than that of politicians. Also direct democracy is related to the benefit principle in public finance. Taxpayers want their payments to be related to public services they receive. They are therefore inclined to veto projects not reflecting their preferences. Moreover, referenda have an implicit restraining effect on governments and the mere threat can reduce their capacity to act.

This contribution investigates the exogenous and endogenous determinants of local government debts in Germany. The municipality cannot influence exogenous factors, whereas endogenous factors are largely driven by the local political competition and exhibit their effects mainly in the local context. Triangulation of different methods is used to reach robust results, encompassing both quantitative research methods and qualitative methods like case studies and interviews. The analysis can thus show, that the local debts are not only explained by socioeconomic, demographic, and income factors, but that political-institutional factors like the local constitutional law, the mayor's party affiliation and the size of the local council are also relevant. In addition, the case studies lend support to the hypothesis that consensus arrangements in the municipality lead to a better financial situation.

During the s, some OECD countries succeeded in reducing their budget deficits. The average public debt ratio fell from more than  per cent of GDP in  to about  per cent of GDP in . Up to now, researchers have mainly focused on the economic effects of these consolidation efforts. This paper answers another question: How can balanced budgets be achieved? By means of a detailed review of nine budget consolidations, the study identifies different roads to successful fiscal adjustments, starting with a critical review of the definition of budget consolidation. We find a pattern on the expenditure side that follows different worlds of the welfare state. On the revenue side however, the tax structure seems to be more path-dependent and mainly driven by long-term developments. In the last section, we show that institutional reforms constitute very important components of budget consolidations.

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