Page 2 - Working Paper (Analysis of Political Budget Cycles in Emerging South East Asian Economies)

DDTC Working Paper 0414 DDTC Working Paper 0414

Analysis of

Political Budget Cycles in

Emerging South East Asian

Economies

Adri Poesoro 1
TABLE OF CONTENTS

Political budget cycles has been widely
studied through many researches that
conducted since many years ago. Most of
researches focused on the causal effects of
1. Background
an election on macroeconomic policies.
Context .................. 3
In this paper, we analyzed the effect of 2. Election Years in
parliamentary and executive election
Five South East
separately in five emerging South East
Asian Countries ...... 3
Asian Countries on fiscal policies during
period 1985 to 2011. Fiscal policies on
3. Fiscal Policy
this paper are refers to direct government
Analysis .................. 4
expenditures and changes in the level and
composition of tax revenue.
4. Data and
Methodology ........... 5
We used econometric approach to analyze
linkage between political events and
5. Econometric
budget cycles. We found that incumbent
Results ................... 6
governments often exercise expansionary
fiscal policies through either reducing
6. Conclusion .............. 9
tax collection or increasing government
expenditure, or both, during election years
to get more voters.

1 Adri A. L. Poesoro is a Chief Economist, DANNY DARUSSALAM Tax
Center

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