What lies behind the promise of fiscal austerity? Unveiling the determinants of party positioning in the EU

The salience of orthodox economic policy in party manifestos is an essential piece of information towards an ex-post assessment of the accountability of politicians in fiscal matters. Using data on political manifestos from the Comparative Manifesto Project database and from additional sources for 15 European Union countries in the 1990-2006 period, we estimate linear and non-linear econometric models to understand the determinants of cross-country variation in pro-austerity manifesto statements. In particular, we present estimates of OLS, Fractional Logit, Beta, and Zero-Inflated Beta models. Here is a summary of our main results. First, support to austerity by left-wing and special interest parties has been mild, and left-wing parties shun austerity in the face of high public debts and high primary surpluses, while right-wing parties take an opposite stance. Second, incumbent parties signal more support to austerity than their competitors, but end up relaxing their commitments when they persist in office for long time. Third, party fractionalization reduces the frequency of orthodox economic policy promises. Finally, the austerity commitments in countries that currently suffer from bad fiscal performance were not necessarily weaker than in “virtuous” countries, but departures from the orthodox economic recipe were not rare.