BUDGET DEFICIT REGULATION AND GROWTH OF GOVERNMENT EXPENDITURE IN THE LARGE 19TH-CENTURY FRANCE (1815-1935) - EMPIRICAL-EVIDENCE FROM A SIMPLE ECONOMETRIC-MODEL OF LIBERAL FISCAL REGIMES

The paper presents a simple annual econometric model of regulation of the fiscal deficit and of the growth of public finance for France between 1815 and 1939. This model provides an appraisal of the dynamics of public finance, pointing differences between the political regimes which have succeeded one after the ether during this period. After a discussion of the lag between fiscal doctrine and practise, a reduced relationship is built where past deficit limits growth of new deficit in exerting positive pressure on taxes and negative one on expenditures. The parameters of the model are functions of the degree of liberalism of the political regimes and of the place of these regimes in the course of a long run fiscal cycle, remanence of the traditional ''kingly'' State, which can be divided into a pacifist and a military phases. Finally, it appears that the ''rentier-liberal'' type of fiscal regime runs all over the long period but is undermined during the third Republic before knowing a structural crisis in the interwar period.