Beliefs about public debt and the demand for government spending

A-Tier
Journal: Journal of Econometrics
Year: 2022
Volume: 231
Issue: 1
Pages: 165-187

Authors (3)

Roth, Christopher (Universität zu Köln) Settele, Sonja (not in RePEc) Wohlfart, Johannes (not in RePEc)

Score contribution per author:

1.341 = (α=2.01 / 3 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We examine how beliefs about the debt-to-GDP ratio affect people’s attitudes towards government spending and taxation. Using representative samples of the US population, we run a series of experiments in which we provide half of our respondents with information about the debt-to-GDP ratio in the US. Based on a total of more than 4,000 respondents, we find that most people underestimate the debt-to-GDP ratio and reduce their support for government spending once they learn about the actual amount of debt, but do not substantially alter their attitudes towards taxation. The treatment effects seem to operate through changes in expectations about fiscal sustainability and persist in a four-week follow-up.

Technical Details

RePEc Handle
repec:eee:econom:v:231:y:2022:i:1:p:165-187
Journal Field
Econometrics
Author Count
3
Added to Database
2026-01-29