Public policy and the initiative and referendum: a survey with some new evidence
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This paper surveys the extensive literature that seeks to estimate the effect of the initiative and referendum on public policy. The evidence on the referendum uniformly finds that requiring voter approval for new spending (or new debt) results in lower spending (or lower debt). The initiative process is associated with lower spending and taxes in American states and Swiss cantons, but with higher spending in cities. The initiative is consistently associated with more conservative social policies. Policies are more likely to be congruent with majority opinion in states with the initiative process than states without the initiative, suggesting that direct democracy allows the majority to counteract the power of special interests in policy making.
KeywordsPublic policy Initiative and referendum Direct democracy Representation
I am grateful for helpful feedback from Zareh Asatryan, Lars Feld, Christina Gathmann, Rod Kiewiet, Jeffrey Lax, Nolan McCarty, David Primo, Christoph Schaltegger, Stefan Voigt, and anonymous referees. USC provided financial support.
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