중동부유럽

The theorical literature on “Political Business Cycles” presents important insights on the extent to which politicians attempt to manipulate government monetary and fiscal policies to influence electoral outcomes, in particular, with the aim of re-election. In recent years “Political Budget Cycles” is the one of the most important topics in Political Business Cycles literature. According to Political Budget Cycles Theory, some components of the government budget are influenced by the electoral cycle and consequently an increase in government spending or decrease in taxes in an election year, leading to larger fiscal deficit. This incumbent’s fiscal manipulation is a tool that governments possess to increase their changes for re-election. In this paper we investigate the presence of Political Budget Cycles using a data set of budget balance, total expenditure and total revenue over the period 1994–2012.