{"title":"The Partisan Politics of Rainy Day Fund Investment","authors":"Lauren Futter","doi":"10.1111/lsq.70038","DOIUrl":null,"url":null,"abstract":"<div>\n \n <p>When do legislatures save for disasters and economic downturns? How do electoral uncertainty and majority party agenda control influence these decisions? I develop a two-stage bargaining model of rainy day fund (RDF) investment. In the first stage, a legislator from the majority party proposes an allocation of the budget between an RDF, particularistic good, and public good. Before the second stage, there is an election and an economic crisis may occur. If a crisis occurs, the legislature can access an existing RDF to fund relief. The model predicts that a majority party is more likely to save when it is likely to remain in the majority, though saving remains below socially optimal levels. Supermajority and other requirements for larger voting coalitions incentivize RDF investment. Testing the results of the model empirically using measures of partisan competition reveal that states with stronger majorities are more likely to invest in their RDFs.</p>\n </div>","PeriodicalId":47672,"journal":{"name":"Legislative Studies Quarterly","volume":"50 4","pages":""},"PeriodicalIF":2.4000,"publicationDate":"2025-10-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Legislative Studies Quarterly","FirstCategoryId":"90","ListUrlMain":"https://onlinelibrary.wiley.com/doi/10.1111/lsq.70038","RegionNum":3,"RegionCategory":"社会学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"POLITICAL SCIENCE","Score":null,"Total":0}
引用次数: 0
Abstract
When do legislatures save for disasters and economic downturns? How do electoral uncertainty and majority party agenda control influence these decisions? I develop a two-stage bargaining model of rainy day fund (RDF) investment. In the first stage, a legislator from the majority party proposes an allocation of the budget between an RDF, particularistic good, and public good. Before the second stage, there is an election and an economic crisis may occur. If a crisis occurs, the legislature can access an existing RDF to fund relief. The model predicts that a majority party is more likely to save when it is likely to remain in the majority, though saving remains below socially optimal levels. Supermajority and other requirements for larger voting coalitions incentivize RDF investment. Testing the results of the model empirically using measures of partisan competition reveal that states with stronger majorities are more likely to invest in their RDFs.
期刊介绍：
The Legislative Studies Quarterly is an international journal devoted to the publication of research on representative assemblies. Its purpose is to disseminate scholarly work on parliaments and legislatures, their relations to other political institutions, their functions in the political system, and the activities of their members both within the institution and outside. Contributions are invited from scholars in all countries. The pages of the Quarterly are open to all research approaches consistent with the normal canons of scholarship, and to work on representative assemblies in all settings and all time periods. The aim of the journal is to contribute to the formulation and verification of general theories about legislative systems, processes, and behavior.
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