ABSTRACT
This chapter provides statistical evidence of the impact of divided control on the overall level of taxation in the period 1934-1988. It reviews some of the literature on the determinants of governmental fiscal policy, noting that none of it takes explicit account of the possibility of divided partisan control of the policymaking apparatus. The chapter considers the impact that divided control might have on tax levels, using the notion of "reversion points" familiar in the spatial modeling literature. It also provides a time series regression to test whether the ideas we have developed hold any water for the period 1934-1988. The normative injunction that fiscal policy should be countercyclical becomes a positive prediction about any particular government's behavior only if that government buys into Keynesianism. The motivation for looking at a finer categorization of partisan control is that the US system empowers each branch separately with its own veto.
