Search

Begin New Search Political Geography Sweden Content Type Working Paper Publishing Institution Max Planck Institute for the Study of Societies

1. Permanent Budget Surpluses as a Fiscal Regime

Author:
Lukas Haffert
Publication Date:
02-2016
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
This paper challenges the focus on budget deficits that permeates the literature on fiscal policy. It analyzes countries running budget surpluses and asks why some of them preserved these surpluses while others did not. Whereas several OECD members recorded surpluses for just a few years, balanced budgets became the norm in Australia, Canada, Denmark, Finland, New Zealand, and Sweden in the late 1990s. The paper compares the fiscal policy choices of both types of countries from a historical-institutionalist perspective. It argues that a path-dependent shift in the balance of power among fiscal policy interests explains why surpluses persisted in one group of countries but not in the other. This reconfiguration of interests was triggered by a deep fiscal crisis and an ensuing expenditure-led consolidation. It can be interpreted as creating a new “surplus regime” in which fiscal policy became structured around the goals of balancing the budget and cutting taxes.
Topic:
Economics, Financial Crisis, Budget, and Europe
Political Geography:
Finland, Denmark, Sweden, and New Zealand

2. Players and New Rules of the Game Politics as Organized Combat: New in Sweden.

Author:
Stefan Svallfors
Publication Date:
02-2015
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
As Hacker and Pierson (2010) have observed, politics is primarily organization: “organized combat.” To understand the outcomes of politics, we have to look at how it is organized over time: by whom and with what resources? I take Sweden as an example of how politics as organized combat has changed quite dramatically in recent decades. Sweden is often cited as an opposite to the United States among the rich capitalist countries, but it has experienced many encompassing policy changes which have not received the attention they deserve. The paper specifies how Swedish organized politics has changed fundamentally, including the dismantling of corporatist arrangements, changes in the economic policy decision-making framework, increased income inequality, weakened political parties and changes in their social bases, the decline of blue-collar union strength, the growth of the policy professionals category, the increased impact of multilevel politics, and the mediatization of politics. Today’s amorphous, invisible mode of elite-driven policy-making diverges greatly from the old corporatist structures and is accompanied by dramatically increasing inequality. Even in Sweden, the impact of money on politics has become stronger. The paper discusses what this implies for current politics and policy-making in Sweden.
Topic:
Economics, Politics, and Labor Issues
Political Geography:
Sweden and United States of America

3. Global Markets, National Tax Systems, and Domestic Politics: Rebalancing Efficiency and Equity in Open States' Income Taxation

Author:
Steffen Ganghof
Publication Date:
09-2001
Content Type:
Working Paper
Institution:
Max Planck Institute for the Study of Societies
Abstract:
Competitive pressure on some capital income tax rates reinforces a generic "quadrilemma" or a four-way tradeoff in domestic income taxation. To maintain competitiveness, governments have to cut some tax rates on capital income down to "international standards." If these cuts lead to a de-alignment of different rates on capital income, domestic allocation becomes more inefficient, all else being equal. Cutting all tax rates on capital income to a uniform low level, while maintaining high and progressive tax rates on labor incomes, avoids this inefficiency, but sacrifices comprehensive income taxation, that is, joint and equal taxation of capital and labor incomes. Finally, reducing all income tax rates to international standards, including top rates on labor income, implies a strong significant reduction in the progressiveness of labor income taxation (and/or significant revenue losses). As a result, governments that aim at all four goals” competitiveness, allocative efficiency, horizontal equity (comprehensive income taxation) and progressivity – and want to maintain a given revenue level cannot avoid seriously compromising one of them. This paper analyzes how this income tax quadrilemma has played out in seven OECD countries: Australia, Denmark, Finland, Germany, New Zealand, Norway, and Sweden. Combining the results of this matched comparison with exploratory data analysis for all OECD countries, the paper discusses the general implications of the quadrilemma for the domestic political economy of tax competition and the future of "domestic compensation" in open states.
Topic:
Economics, International Trade and Finance, and Political Economy
Political Geography:
Finland, Norway, Denmark, Georgia, Australia, Sweden, and New Zealand