Creative accounting and electoral motives: Evidence from OECD countries

Governments can engage in "creative accountingâ[euro] to hide borrowing and sugarcoat the budget balance. * I use the difference between the change in public debt and the deficit (stock-flow adjustment) to measure creative accounting. * I show that governments engaged in creative accounting before elections. * I provide an overview of government interventions that gave rise to large stock-flow adjustments. Using an unbalanced panel of 27 OECD countries over the period 1970-2011, I examine whether electoral motives influenced creative accounting. Governments engage in "below-the-lineâ[euro] ope... Mehr ...