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Voter turnout and the Size of GoVernment

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Voter turnout and the Size of GoVernment
Uppsala Center for Fiscal Studies
Department of Economics

Working Paper 2013:14

Voter Turnout and the Size of Government
Linuz Aggeborn

Uppsala Center for Fiscal Studies
Working paper 2013:14
Department of Economics
November 2013
Uppsala University
P.O. Box 513
SE-751 20 Uppsala
Sweden
Fax: +46 18 471 14 78

Voter Turnout and the Size of Government
Linuz Aggeborn

Papers in the Working Paper Series are published on internet in PDF formats.
Download from http://ucfs.nek.uu.se/

Voter Turnout and the Size of Government

∗

Linuz Aggeborn†
November 4, 2013

Abstract
This paper investigates the causal link between voter turnout and policy outcomes related to the size of government. Tax rate and public expenditures are the focal policy outcomes in this study. To capture the causal mechanism, Swedish and Finnish municipal data are used and a constitutional change in Sweden in 1970 is applied as an instrument for voter turnout in local elections. In 1970, Sweden moved from having separate election days for different levels of government, among other things, to a system with a single election day for political elections, thus reducing the cost associated with voting. This constitutional reform increased voter turnout in local elections in Sweden.
The overall conclusion of this paper is that higher voter turnout yields higher municipal taxes and larger local public expenditures. Second, there is some evidence that higher turnout decreases the vote share for right-wing parties.

Key-words: Voter Turnout, Size of government, Sweden, Finland, Local public finance, Instrumental variable regression

JEL Classification Codes: D72 D70 H39

∗

I would like to thank Eva M¨rk and Mikael Elinder for many valuable comments. I o would also like to thank Antti Moisio, Janne Tukiainen and the rest of the faculty at the
Government Institute for Economic Research (VATT) in Helsinki where I collected the
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