Kommunale Schulden in Deutschland

Evaluating the success of instruments which aim at reducing local government debt is a highly relevant issue in the light of existing debt problems at the local level in Germany and insufficient research into them. However, adequate empirical analysis is to some extent confronted with the challenge of a small number of observations and ambiguous cause–effect relations. This quantitative study takes the causal effects of austerity commissioners, financial aid programmes and debt brakes on local government debt into account by using different types of synthetic control methods. Its findings do not confirm that these instruments have a consistently positive effect, but that the success of the instruments seems to be highly context-specific.