Constitutional Barriers as Limitations to State Activity

Abstract

ZusammenfassungThe study deals with constitutional constraints and examines which constitutional limits or barriers set by ordinary law are effective against too much public policy. Are these limits useful to block the level and the growth of expenditures, taxation and public debt? Starting points of the analysis are historical considerations on past experiences with constitutional constraints. In a second step a typology of constitutional and legislative barriers will be presented and discussed. These barriers can be distinguished between quantitative and procedural constraints. Empirical findings for different countries as well as for the European Union will be presented. Finally, empirical results will be derived from a pooled cross sectional regression, where several factors are regressed on the annual deficit. It turns out that limits on taxation and expenditure limitations (TEL) as well as limits on public debt have pros and cons. These will be assessed on the basis of the empirical findings. A clear result of the comparative research points to the efficiency in blocking public policy, i.e. spending, taxation and the public debt. This entails that the main target of such rules is usually achieved.