Warum die Direkte Demokratie den Anstieg der Staatsausgaben in der Schweiz nicht verhindern konnte

Abstract

Abstract Switzerland experienced a strong increase in government spending during the 1990’s. The immediate reasons are well-known: higher expenditure for the elderly and other areas of social security as well as higher expenditure for health care make up most of the increase. The political reasons are not that clear, however. A by now large literature argues that direct democracy in Switzerland reduces government spending at the level of cantons and municipalities. First, the theoretical and empirical basis for this claim is critically reviewed. Second, it is found that the variation of direct democracy between cantons had no effect on the growth of government spending during the 1990’s. Third, the effect of direct democracy on the level of spending is not negative in all specifications and was decreasing during the 1990’s.