Legislatures, Leaders, and Leviathans: How Constitutional Institutions Affect the Size of Government Spending

Abstract

Research has shown that government spending can affect GDP growth rates, yet there is no comprehensive study that looks at how a country’s choice of political institutions affects government spending. Using a panel of 92 democracies, this paper focuses on how the choice of regime type (presidential, parliamentary or mixed), legislative chamber structure (bicameral or unicameral), legislative chamber size, and electoral rules affect the level of government spending. The results show that the relationship between legislative chamber size and government spending is linear in unicameral countries but non-linear in bicameral countries, plurality electoral rule is always associated with less spending than any other type of electoral rule, and unicameral and bicameral countries should not be modeled together.