Policy choices in assembly versus representative democracy: Evidence from Swiss communes

Abstract

This paper investigates whether the form of the legislative institution - citizen assembly versus elected parliament - affects the level and composition of local public expenditure. Our empirical analysis focuses on medium-sized and mostly German-speaking communes in Switzerland that switched from assembly to parliament between 1945 and 2010. Event study estimates suggest that parliament adoption increases total spending by about 6% and that this increase is driven mostly by general administration and education spending. To understand potential mechanisms at play, we run a survey among assembly participants and document a sizeable under-representation of 20- to 40-year-olds, as well as of women in assemblies compared to both voters in elections and to the electorate at large. Since these two demographics have relatively strong preferences for public spending on education in our setting, switching from citizen assembly to parliament likely increased their representation in the political process.