Bicameralism and Budget Deficits: The Effect of Parliamentary Structure on Government Spending

Positive constitutional economics II—a survey of recent developments

“…There are conflicting hypotheses regarding the potential effects of bicameralism on fiscal policies. Heller (1997) argues that the higher number of veto players in bicameral systems leads to higher budget deficits. To secure the consent of an additional veto player, additional expenditure needs to be agreed upon, which will lead both to higher spending and deficits.…”

Legislative Institutions and Fiscal Policy

“…[TABLE 3 ABOUT HERE] Table 3 also reports results for the committee hypothesis by Crain and Muris (1995) and Heller's (1997) claim about the fiscal effect of bicameralism. The coefficient for the budget committee dummy has the wrong sign and is not significant (column 5).…”

“…[ In addition, I reconsider whether bicameralism affects public spending, as Heller's (1997) original hypothesis suggests. I use a simple dummy to indicate budgetary unicameralism, where 1 = the second chamber has lesser budgetary powers than the lower chamber or parliament is unicameral and 0 = otherwise.…”

Cabinet Structure and Fiscal Policy Outcomes

“…As there is much less within-country variation in the number of seats in the lower house than in the number of spending ministers, this aspect could be explored further through cross-sectional analysis. Such an analysis should take into account bicameralism and the possibly distinct budgetary impact of second chambers (Heller 1997(Heller , 2001Bradbury & Crain 2001;Cusack & Fuchs 2003). Second, I checked whether the effect of the number of spending ministers differs across forms of government, by interacting this variable with a dummy for presidential systems (Persson & Tabellini 2003).…”