Distributive Policies in Parliamentary Systems : the Interplay between Electoral and Fiscal Institutions

Why do some countries spend more on and make more use of distributive measures than others? Which institutions systematically shape spending on and frequency of use of these measures? Cross-country longitudinal tests of theories that emphasize the institutional determinants of distributive policies are rare. We test a battery of competing hypotheses on spending and frequency using data on state aid expenditure by EU member states between 1992 and 2009 and on applications logged by such states between 1999 and 2009. We find that higher district magnitude lowers spending on and use of distributive measures if party leaders control access to the ballot rank. More measures are adopted if an increase in magnitude is associated with lack of ballot control. In case of single party majority or cohesive coalition governments, greater reliance on delegation rather than contract fiscal institutions lowers spending.