Working Papers

"The power of the purse and the budgetary reversion"

When a country does not adopt a budget by the beginning of a new fiscal year, it must define what expenditures are then legally allowed.  The shutdown of the US federal government in October 2013 illustrates one possibility.  In this paper, I document a dramatic increase in the number and proportion of the world’s constitutions that avoid shutdowns and instead mandate what I call executive-favoring budgetary reversions, or EFRs.  After describing how such reversions can eviscerate the legislature’s power of the purse, I show that democracies with EFRs die considerably faster than do those in which the reversion is a government shutdown. EFRs are particularly good predictors of democratic death due to auto-coup, as would be expected if they enhance the executive’s ability to extract rents from the state budget.  It appears that Huntington’s (1991) well-known waves of electoral democracy have been partly countervailed by waves of fiscal autocracy.