More For Less? Comparing Citizen and Politicians’ Budgeting Preferences

“Budgeting is a core function of government and crucial for policymaking. It encompasses decisions about spending distribution across policy areas, taxation, and public debt, making it a critical determinant of both the emergence and reduction of inequality.
Previous research has dedicated considerable attention to voters’ attitudes towards government spending (Busemeyer & Garritzmann, 2017; Hayo & Neumeier, 2019; Keefer et al., 2020). Whereas recent studies have employed increasingly sophisticated methods to understand citizens’ budgeting and taxation preferences, going beyond the question of whether they want “more” or “less” spending for a given policy area (Barnes, 2015; Stantcheva, 2018), evidence about politicians’ preferences in budgeting primarily relies on aggregated, observational data (Breunig, 2011; Breunig & Busemeyer, 2012). Thus, we know relatively little about individual politicians’ decision-making when faced with a budgeting task and even less about congruence between citizens and representatives when it comes to budgeting.
This paper presents comparative evidence on spending and fiscal policy preferences from parallel citizen-politician surveys conducted through the PolPop III survey, covering seven countries: Australia, Canada, Denmark, Germany, Luxembourg, Israel, and Norway. Respondents completed an interactive budgeting questionnaire (Alesina, 2018) enabling them to (re)allocate spending from its current distribution among seven core policy areas: defense and public safety, education, environment, health, pensions, social protection (excluding pensions), and transport and infrastructure. Subsequently, respondents indicated their fiscal policy preferences.
Our main theoretical interest concerns citizens and politicians’ preferences regarding the intertemporal distribution of costs and benefits – specifically, how they reallocate between consumption and investment policies combined with fiscal policy decisions (remedying budget deficits through tax increases or public debt versus using budget surpluses to decrease taxes or debt). While the full dataset will be available by the end of 2025, preliminary evidence suggests that voters generally prefer consolidated budgets or budget deficits. Simultaneously, citizens appear surprisingly long-term oriented. On average, they are willing to accept cuts in consumption spending (social protection, health, and pensions) to favor investment spending (environment, education, infrastructure), and nearly 50% support tax increases rather than public debt increases to finance budget deficits. Age-based cleavages emerge, where the young show a strong preference for investment spending and the old are willing to cut spending for social protection (only) if pensions are spared.
The next steps involve testing our pre-registered hypotheses regarding determinants of preference variation at the individual and country level, as well as comparing citizens’ budgeting preferences with those of their political representatives.”