Has Leviathan Been Bound? A Theory of Imperfectly Constrained Government with Evidence from the States

Abstract

This paper develops a formal theory that combines power-maximizing "Leviathan" political parties with well-defined imperfections in the political process. The model implies that both parties tend to make government larger as their likelihood of electoral victory increases. Empirical tests on state-level data confirm this prediction. Racing the Leviathan hypothesis against alternative theories of party motivation indicates that both the Leviathan and the "contrasting ideologies" views have some degree of validity.

Democrats, republicans, and taxes: Evidence that political parties matter

“…Alt and Lowery (2000) estimate that tax revenues are higher when Democrats control the state budgetary process. Caplan (2001) finds that taxes increase with the percent Democratic representation in either of the state's legislative chambers. However, there is no evidence that taxes are higher when Democrats are in control of the legislative chambers.…”

“…Further, it has been used in numerous empirical studies of taxes, including Dye (1980), Helms (1985, Benson and Johnson (1986), Canto and Webb (1987), Mofidi and Stone (1990), Yu, Wallace, and Nardinelli (1991), Mullen and Williams (1994), Carroll and Wasylenko (1994), Knight (2000), Yamarik (2000Yamarik ( , 2004, and Caplan (2001).…”

The Robust Relationship between Taxes and U.S. State Income Growth

“…Tax burden is by far the most commonly employed measure of state taxation, and can be thought of as the "effective average tax rate" in a state (e.g., Helms, 1985;Mofi di and Stone, 1990;Mullen and Williams, 1994;Carroll and Wasylenko, 1994;Knight, 2000;Caplan, 2001;Yamarik, 2000Yamarik, , 2004Alm and Rogers, 2005). Table 1 summarizes the initial results.…”

When is two better than one? How federalism mitigates and intensifies imperfect political competition

“…In contrast, both Brennan and Buchanan (1980) and McGuire and Olson (1996) assume they seek to maximize their own power. 3 Caplan (1999a) presents empirical evidence on the relative merits of the ideological and power-maximizing views of party motivation, finding that both theories have some validity. The core of this paper builds on the power-maximizing assumption because it makes the model more tractable and the results clearer: Unlike ideological parties, all power-maximizing parties want to shirk in the same way.…”