I thank Stephan Haggard, Gary Reich, Dennis Duermeier, and anonymous reviewers for the Journal for helpful comments and suggestions. The responsibility for all errors rests with the author alone.Google Scholar

1. See Brown, David and Hunter, Wendy, “Democracy and Social Spending in Latin America, 1980–92,” American Political Science Review 93, no. 4 1999): 779–790; Jones, Mark, “Political Institutions and Public Policy in Argentina: An Overview of the Formation and Execution of the National Budget.” In Haggard, Stephan and McCubbins, Mathew, eds., Presidents, Parliaments, and Policy (New York: Cambridge University Press, 2001); Lipsmeyer, Christine, “Parties and Policy: Evaluating Economic and Partisan Influences on Welfare Policy Spending During the European Post-Communist Transition,” British Journal of Political Science 32, no. 4 (2002): 641–661; Pereira, Carlos and Mueller, Bernando, “The Cost of Governing: Strategic Behavior in Brazil's Budgetary Process,” Comparative Political Studies 37, no. 7 (2004): 781–815.Google Scholar

2. Pereira, and Mueller, , “The Cost of Governing,” show that increases in government spending reflect the Brazilian executive's reward of legislative cooperation and that uncooperative legislators are rewarded less frequently and inconsistently. I take the argument further to consider whether the strategic use of government spending leads to a reduction in government spending to penalize uncooperative behavior.Google Scholar

3. See Jones, , “Political Institutions and Public Policy in Argentina”; and Lipsmeyer, , “Parties and Policy.” Google Scholar

4. The exceptions are Cheng, Tun-jen and Haggard, Stephan, “Democracy and Deficits in Taiwan.” In Haggard, and McCubbins, , Presidents, Parliaments, and Policy; McCubbins, Mathew D. and Thies, Michael F., “As a Matter of Factions: The Budgetary Implications of Shifting Factional Control in Japan's LDP,” Legislative Studies Quarterly 22, no. 3 1997): 293–328.CrossRefGoogle Scholar

5. I make explicit this need for the majority coalition to occur in a competitive multiparty system to take into consideration that majority coalitions may exist in party systems where the opposition parties are not viable, such as Malaysia.Google Scholar

6. See also Eaton, Kent, “Parliamentarism Versus Presidentialism in the Policy Arena,” Comparative Politics 32, no. 3 2000): 355–376. Eaton cites three studies of Japan and the United States that conclude that national defense is a public good that executives “take responsibility for shaping” (p. 366).Google Scholar

7. Studies that consider strategic policymaking in Asia include Fiona Yap, O., “Non-electoral Responsiveness Mechanisms: Evidence from the Asian Less Democratic Newly Industrializing Countries,” British Journal of Political Science 33, no. 3 2003): 491–514; Feng, Yi (with Huckeba, Margaret, Son Nguyen, T., and Williams, Aaron), “Political Institutions, Economic Growth, and Democratic Evolution: The Pacific Asian Scenario.” In de Mesquita, Bruce Bueno and Root, Hilton, eds., Governing for Prosperity (New Haven: Yale University Press, 2000); David Mason, T., “Modernization and Its Discontents Revisited: The Dynamics of Mass-based Opposition in the People's Republic of China,” Journal of Politics 56, no. 2 (1994): 400–424.Google Scholar

8. See, for instance, Eaton, , “Parliamentarism versus Presidentialism in the Policy Arena”; Pereira, and Mueller, , “The Cost of Governing”; Baldez, Lisa and Carey, John, “Presidential Agenda Control and Spending Policy: Lessons from General Pinochet's Constitution,” American Journal of Political Science 43, no. 1 1999): 29–55; Cheng, and Haggard, , “Democracy and Deficits in Taiwan.” Google Scholar

9. Data availability, especially for the democratization variable, largely determined that the examination began in the year 1972 for both nations. Defense and civilian expenditures are available for Taiwan since the 1960s, but for South Korea, the series are not available until 1971. See also Freedom House, Freedom in the World (New York: Freedom House, 1972–2002).Google Scholar

10. See, for instance, Asian Development Bank, Key Indicators of Developing Asian and Pacific Economies (Manila: Asian Development Bank, 2003); and the Yearbook of the Financial Statistics (Taipei: Ministry of Finance, 1980–2002). I thank an anonymous reviewer for pointing out the need to clarify the composition of total government spending.Google Scholar

11. In particular, this treatment of total, civilian, and defense spending moves away from a zero-sum perspective (guns versus butter) to consider that the executive may accommodate the priorities of the legislature as well as personal priorities, by reducing, for example, administrative costs or negotiating lower debt repayments. I thank an anonymous reviewer for asking for clarification.Google Scholar

12. For an excellent review of the results of electoral spending, see Kwon, Hyeok-yong, “Targeting Public Spending in a New Democracy: Evidence from South Korea,” British Journal of Political Science 35, no. 2 2005):321–341.Google Scholar

13. See, for instance, Brown, and Hunter, , “Democracy and Social Spending in Latin America, 1980–92”; Lebovic, James, “Spending Priorities and Democratic Rule in Latin America,” Journal of Conflict Resolution 45, no. 4 2001):427–452.Google Scholar

14. See, for example, Tufte, Edward, Political Control of the Economy (Princeton: Princeton University Press, 1978); Alt, James, “Political Parties, World Demand, and Unemployment; Domestic and International Sources of Economic Activity,” American Political Science Review 79, no. 4 (1985): 1016–1040; Keech, William, Economic Politics (New York: Cambridge University Press, 1995); Alesina, Alberto, Roubini, Nouriel, and Cohen, Gerald, Political Cycles and the Macroeconomy (Cambridge: MIT Press, 1997), pp. 167–208.Google Scholar

15. See Keech, , Economic Politics , p. 65.Google Scholar

16. In particular, these studies move beyond the treatment of conflict as a divided government phenomenon to consider that disagreements over policy priorities may occur because (1) executives and legislatures have different institutional roles regarding how and what policies are made and (2) executives respond to a national constituency while legislatures respond to narrower, local interests. See, for example, Baldez, Lisa and Carey, John, “Presidential Agenda Control and Spending Policy; Cheng, and Haggard, , “Democracy and Deficits in Taiwan”; Reich, Gary, “Coordinating Restraint: Democratization, Fiscal Policy and Money Creation in Latin America,” Political Research Quarterly 52, no. 4 1999): 729–751.Google Scholar

17. See, for instance, Reich, , “Coordinating Restraint”; and Lipsmeyer, , “Parties and Policy.” Clearly, the legislators need to build support in the legislature in order to pursue particularistic programs; the existence of pork-barrel policies suggests that the practice is common and not in the least problematic.Google Scholar

18. Studies show that strategic policymaking and bargaining occur in the less democratic countries; this contradicts the conventional treatment that governments in these countries are indisposed to or do not need negotiations. See Yap, , “Non-electoral Responsiveness Mechanisms”; Feng, , “Political Institutions, Economic Growth, and Democratic Evolution”; Mason, , “Modernization and Its Discontents Revisited.” Google Scholar

19. I make no argument and do not distinguish between the reasons why the executive wants to lead the party or why legislators want to win elections, which include: to fill their own coffers, to promote the social good, to reduce criticism or undermine political opposition, to placate supporters, or to promote an ideology.Google Scholar

20. See note 6.Google Scholar

21. On the one hand, the squeaky wheel gets the grease; on the other hand, they may be ostracized or sent to the back benches. For anecdotal support, consider the strengths of the conservative right and liberal left in US politics.Google Scholar

22. See, for example, Eugene Kim, C. I., “Korea at the Crossroads: The Birth of the Fourth Republic,” Pacific Affairs 46, no. 2 1973):218–231; Cheng, and Haggard, , “Democracy and Deficits in Taiwan”; Hood, Steven, Asian Survey 36, no. 5 (1996): 468–482; Korea Annual (Seoul: Yonhap News Agency, 1971–1994).Google Scholar

23. See, for example, Winkler, Edwin, “Institution and Participation in Taiwan: From Hard to Soft Authoritarianism?” China Quarterly , no. 99 (1984):481–990; Chou, Yangsan and Nathan, Andrew, “Democratizing Transition in Taiwan,” Asian Survey 27, no. 3 (1987): 277–299; Cheng, Tun-jen, “Democratizing the QuasiLeninist Regime in Taiwan,” World Politics 41, no. 4 (1989): 471–499; Young, Whan-kihl, “South Korea in 1989: Slow Progress Toward Democracy,” Asian Survey 30, no. 1 (1990): 67–73; Han, SungJoo, “South Korea in 1987: The Politics of Democratization,” Asian Survey 28, no. 1 (1988): 52–61.Google Scholar

24. See, for example, Chu, Yun-han, Diamond, Larry, and Shin, Doh-chull, “Halting Progress in Korea and Taiwan,” Journal of Democracy 12, no. 1 2000):122–136; Cheng, and Haggard, , “Democracy and Deficits in Taiwan”; John Kie-Chang Oh, Korean Politics (Ithaca: Cornell University Press, 1999).Google Scholar

25. For instance, in the December 1972 presidential elections, President Park won all but two of the 2,359 votes cast by the deputies of the electoral college, the National Conference for Unification, because the two votes were considered invalid (Korea Annual, 1973). Legislative elections suffered equally: for instance, emergency laws against political activities significantly compromised the ability of opposition parties to meet to plan and execute election campaigns. Notwithstanding these efforts, in the 1973 legislature elections, votes for the opposition combined to reach a total of 43 percent, as opposed to the ruling party's 39 percent (Korea Annual, 1974). See also Korea Annual, 1970–1980. Google Scholar

26. See Korea Annual, 1988–1989. Google Scholar

27. Thus, for instance, in 1965, Kim Jong-pil's powers as secretary-general of the ruling party were curtailed; in 1969, he was advised to publicly pledge “support” for the constitutional amendment removing term limits for the president (Korea Annual, 1964–1970).Google Scholar

28. See Korea Annual 1970–1972. Google Scholar

29. See Korea Annual, 1986–1987; Eugene Kim, C. I., “South Korea in 1985: An Eventful Year Amidst Uncertainty,” Asian Survey 26, no. 1 1986):66–77.Google Scholar

30. See Oh, John Kie-Chang, Korean Politics. Google Scholar

31. See Fiona Yap, O., Citizen Power, Politics, and the “Asian Miracle”: Reassessing the Dynamics (Boulder: Lynne Rienner, 2005); Economist Intelligence Unit, “By-election Blow for Uri,” London, May 3, 2005.Google Scholar

32. Office of the President of the Republic of China, “Republic of China Introduction,” (accessed March 17, 2005).Google Scholar

33. See, for example, Yap, , Citizen Power, Politics, and the “Asian Miracle”; Dickson, Bruce, “The Kuomintang Before Democratization: Organizational Change and the Role of the Elections.” In Tien, Hung Mao, ed., Taiwan's Electoral Politics and Democratic Transition (New York: M. E. Sharpe, 1996).Google Scholar

34. See Hood, , “Political Change in Taiwan”; and Cheng, and Haggard, , “Democracy and Deficits in Taiwan.” Google Scholar

35. See Yap, , Citizen Power, Politics, and the “Asian Miracle.” Google Scholar

36. The “Temporary Provisions” is an abbreviation for the Provisional Amendment for the Period of Mobilization of the Suppression of Communist Rebellion. Also see Office of the President of the Republic of China, 2001; Republic of China Yearbook (Taiwan: Government Information Office, 1981–2004). Continued from China Yearbook (Taiwan: Government Information Office, 1957–1980).Google Scholar

37. See Republic of China Yearbook, 1965–1980; Republic of China Yearbook, 1981–1985 ; Dickson, , “The Kuomintang before Democratization.” Google Scholar

38. See Republic of China Yearbook, 1991. Google Scholar

39. Also known as the Formosa Incident, the Kaohsiung Incident occurred on December 10, 1979, when military police and demonstrators clashed at a World Human Rights Day organized by Formosa magazine. The Formosa magazine began publishing in the summer of 1979 as a journal highly critical of the KMT government.Google Scholar

40. See Taiwan Communique (Chevy Chase, MD: International Committee for Human Rights in Taiwan, 1990-1993).Google Scholar

41. See Tien, Hung-mao, “Taiwan in 1995: Electoral Politics and Cross-Strait Relations,” Asian Survey 36, no. 1 1996):33–40; Wu, Yu-shan, “Taiwan in 2000: Managing the Aftershocks of Power Transfer,” Asian Survey 48, no. 1 (2001): 40–48.Google Scholar

42. See Yap, , Citizen Power, Politics, and the “Asian Miracle,” p. 27.Google Scholar

43. See Article 28 of the Budget Act, Directorate-General of Budget, Accounting, and Statistics, Budget Act (2003) http://eng.dgbas.gov.tw/public/Data/512614374271.pdf (accessed June 1, 2005); 2001 National Budget, Ministry of Budget and Planning, South Korea (2005, 2004, 2003, 2002, 2001). For instance, the Ministry of Budget and Planning, South Korea, stipulates that its budget preparation process include some “detailed analyses and adjustments in specific budget areas ' [which] involves negotiations with relevant government agencies and interest groups” (National Budget 2001, pp. 15, 17). Similarly, the Directorate-General of Budget, Accounting, and Statistics, Taiwan, stipulates that the central budget accounting and statistics agency shall “depending on actual needs, listen to the description of the budget estimate contents briefed by the competent agency that compiles the budget estimates” for its particular use (Budget Act, Article 35, 2003).Google Scholar

44. See, for instance, National Budget (South Korea, 2001, p. 15); Budget Act (Taiwan, 2003: Article 31).Google Scholar

45. Both Taiwan and South Korea provide some flexibility for government spending during the fiscal year. Thus, in Taiwan, government agencies may apply for additional expenditures during the fiscal year (Article 79 of Budget Act, 2003) while in South Korea, transfers between budget accounts and items are allowed (2001 National Budget, South Korea). Article 83 of the Budget Act in Taiwan stipulates that the executive may propose a supplementary budget under any of these four circumstances: (1) national defense emergency or war; (2) major economic event; (3) major calamity; (4) major political event that takes place “irregularly or once every few years” (Directorate-General of Budget, Accounting, and Statistics, 2003). Article 56 of the South Korean constitution provides that the legislature must approve the supplementary budget. See Constitution of the Republic of Korea (Seoul, 2003), (accessed January 2005).Google Scholar

46. See Constitution of the Republic of China , 2003. Taipei, , (accessed January 2005); Budget Act (2003), Article 3, and its subsections were recommended by the National Development Conference mentioned earlier in the text, adopted by the National Assembly on July 18 and promulgated by the president on July 21, 1997. See also Chapter 5, Article 83 of the Budget Act (2003). The fiscal year for Taiwan was July to June until FY 1998/99. For FY 2000, it ran from July 1999 to December 2000. Since 2000, it has followed the calendar year. See CIA Factbook (2005), (accessed June 1, 2005).Google Scholar

47. See National Budget (Seoul, 2005); Constitution of the Republic of Korea. Google Scholar

48. See note 11 and introduction in the text.Google Scholar

49. See, for example, Chan, Steve, “Grasping the Peace Dividend: Some Propositions on the Conversion of Swords into Plowshares,” Mershon International Studies Review 39, no. 1 1995):53–95; Coppedge, Michael, “Democracy and Dimensions: Comments on Munck and Verkuilen,” Comparative Political Studies 35, no. 1 (2002): 35–39; Yap, , Citizen Power, Politics, and the “Asian Miracle.” Google Scholar

50. In particular, economic data for Taiwan are obtained or calculated from the Taiwan Statistical Data Book (Taipei: Council for Economic Planning and Development, 1970–2003) and the Yearbook of the Financial Statistics (Taipei: Ministry of Finance, 1980–2002), respectively. Data on elections and legislative fragmentation on Taiwan are gathered from figures released by the Central Election Commission, which may be found in several sources, including Annual Review of Government Administration (Taipei: Research, Development, and Evaluation Commission, 1976–1990) and Taiwan Communique (1990–2003). For Korea, South, economic data are based on figures reported by the Asian Development Bank and the IMF's Government and Finance Statistics Yearbook (Washington, DC: 1990–2002). Data on elections and legislative fragmentation are gathered from Korea Annual (1965–2002) and Elections Around the World (www.electionworld.org/index.html, Wilfred Derksen).Google Scholar

51. See Lebovic, , “Spending Priorities and Democratic Rule in Latin America”; Kwon, Hyeok-yong, “Economic Reform and Democratization: Evidence from Latin America and Post-Socialist Countries,” British Journal of Political Science 34, no. 2 2003):357–368.Google Scholar

52. See Feng, , “Political Institutions, Economic Growth, and Democratic Evolution”; Bollen, Kenneth and Jackman, Robert, “Democracy, Stability and Dichotomies,” American Sociological Review 54, no. 4 1989):612–621.Google Scholar

53. See, for example, Winkler, , “Institution and Participation in Taiwan: From Hard to Soft Authoritarianism?”; Chou, and Nathan, , “Democratizing Transition in Taiwan”; Cheng, , “Democratizing the QuasiLeninist Regime in Taiwan”; Young, , “South Korea in 1989: Slow Progress Toward Democracy”; Han, , “South Korea in 1987: The Politics of Democratization”; Cheng, and Haggard, , “Democracy and Deficits in Taiwan.” Google Scholar

54. Substantively and statistically, the effects from using this ordinal scale from 2 to 14 are the same as using a [0, 1] score, where 1 reflects the highest level of democracy and 0 the lowest or a dichotomous measure of democracy (0, 1), where Taiwan is considered democratic in 1996 and South Korea democratic in 1992. The 1996 and 1992 dates consider both nations to be democracies only following the direct election or installation of civilians as presidents. See Kwon, , “Economic Reform and Democratization”; Oh, , Korean Politics; and Cheng, and Haggard, , “Democracy and Deficits in Taiwan.” Google Scholar

55. Briefly, time series data such as GDP or prices exhibit trends or non-stationarity that conflate interpretation. Such data need to be transformed before use to avoid biased findings. See Kennedy, Peter, A Guide to Econometrics , 5th ed. (Cambridge: MIT Press, 2003); Greene, William, Econometric Analysis, 5th ed. (Upper Saddle River, NJ: Prentice Hall, 2003).Google Scholar

56. For instance, the Database of Political Institutions reports “0” as the fractionalization index of the governing party in South Korea between 1972 and 1997, that is, until a majority coalition was created in South Korea following the 1997 elections. Similarly, the fractionalization index for the ruling party in Taiwan is coded as “0” for the entire period of the data (between 1975 and 2000). See Thorsten, Beck, Clarke, George, Groff, Alberto, Keefer, Philip, and Walsh, Patrick, “New Tools in Comparative Political Economy: The Database of Political Institutions,” World Bank Economic Review 15, no. 1 2001):165–176; Korea Annual (1963–1988); Hood, , “Political Change in Taiwan: The Rise of the Kuomintang Factions”; and Cheng, and Haggard, , “Democracy and Deficits in Taiwan,” report intraparty conflicts before 2000.Google Scholar

57. Sources used are country reports, such as the Korea Annual (1964–2003) and the Republic of China Yearbook, which was preceded by the China Yearbook (1960–2004); these are verified by country expert annual accounts, such as in Asia Survey, China Quarterly, and Pacific Studies. We also use news reports, including Nikkei Weekly, United Press International, The Economist, The Financial Times, The FT Asia Intelligence Wire, The Daily Yomuiri, Janet Mathews Information Services, and Xinhua News. Google Scholar

58. See also Collier, David and Adcock, Robert, “Democracy and Dichotomies: A Pragmatic Approach to Choices and Concepts,” Annual Review of Political Science 2 (1999):537–565; Yap, , “Non-electoral Responsiveness Mechanisms,” p. 498.Google Scholar

59. Specifically, the variables measuring presidential elections were statistically insignificant over time for both South Korea and Taiwan. Also, the addition of the variable inflated errors and decreased the variance explained for the model. See also Cheng, and Haggard, , “Democracy and Deficits in Taiwan.” Google Scholar

60. See Keech, , Economic Politics; and Alesina, et al., Political Cycles and the Macroeconomy. Google Scholar

61. See, for instance, Korea Annual (1971); China Yearbook (1966); and Annual Review of Government Administration (1981); Barro, Robert, “Government Spending in a Simple Model of Endogenous Growth,” Journal of Political Economy 98, no. 5, part 2 (1990):S103–S125.Google Scholar

62. See, for instance, Annual Review of Government Administration (1986, 1990); Brown, and Hunter, , “Democracy and Social Spending in Latin America, 1980–92”; Bawn, Kathleen, “Money and Majorities in the Federal Republic of Germany,” American Journal of Political Science 43, no. 3 (1999): 303–334; Krause, George, “Partisan and Ideological Sources of Fiscal Deficits in the United States,” American Journal of Political Science 44, no. 3: 541–559; Lebovic, , “Spending Priorities and Democratic Rule in Latin America.” Google Scholar

63. This is not surprising, given the transformations of the data. The Augmented Dickey-Fuller and Phillips-Perron tests were used to evaluate for unit root problems and the Durbin-alternative and Breusch-Godfrey LM tests for serial correlation. The results are substantively similar and report no unit root or serial correlation problems in the data. See discussion of lagged variables in Christopher Achen, “Why Lagged Dependent Variables Can Suppress the Explanatory Power of other Dependent Variables,” paper presented at the annual meeting of the Political Methodology Section, July 20–22, 2000, http://polmeth.wustl.edu/.Google Scholar

64. See notes 54 and 62.Google Scholar

65. Briefly, the Chow test compares a restricted regression model, which contains the observations for the entire period, and unrestricted models, which are based on subsets of the period. See Greene, , Econometric Analysis , and Kennedy, , A Guide to Econometrics, for further discussions. We use Chow tests to evaluate both 1987 and 1992 as possible break points in South Korea, and 1992 and 1996 in Taiwan. See note 55 for discussion of the years as break points. The results were not statistically or substantively different; both report that government, defense, and civilian spending patterns were not structurally different using either break points.Google Scholar

66. For a similar argument that democracy indirectly (not directly) affects growth and that, consequently, only tests that model the indirect effects provide accurate interpretations, see Baum, Matthew and Lake, David, “The Political Economy of Growth: Democracy and Human Capital,” American Journal of Political Science 47, no. 2 2003):333–347.Google Scholar

67. The results of these tests show that political, economic, and social variables do not explain defense or military in South Korea and Taiwan. Instead, as the reduced equations show, the most important statistical predictors are the lagged dependent and total spending variables.Google Scholar