Pre-electoral fiscal policies and opportunistic spending: the case of the recently decentralised Macedonian local governments

Abstract

ABSTRACT The purpose of this study is to test the relationship between local elections and local government budgets. Using dataset of all Macedonian municipalities for the period 2007-2015, this study examines whether the overall spending and the composition of local government expenditures are systematically manipulated just before elections. The results show that spending during the pre-election period shifts toward more desirable categories such as permanent and temporary employment, capital projects, and individual transfers and subsidies. Very few studies relate pre-electoral fiscal manipulation to clientelistic linkages. This paper fills the void by adding empirical evidence from a transitional democracy.