European Journal of Political Economy Ž . Vol. 16 2000 287–306 Direct democracy, political culture, and the outcome of economic policy: a report on the Swiss experience Lars P. Feld, Gebhard Kirchgassner ) ¨ UniÕersity of St. Gallen, SIAW-HSG, Institutsgebaude, Dufourstr. 48, St. Gallen CH-9000, Switzerland ¨ Received 1 April 1999; received in revised form 1 October 1999; accepted 1 November 1999 Abstract Political culture in Switzerland is, to a large extent, influenced by its direct democracy. Compared to purely representative systems, direct democracy leads to a different type of communication among citizens and also between citizens and representatives. The opportu- nity of deciding for themselves on political issues provides citizens with incentives to collect more information. Because citizens are better informed, politicians have less leeway to pursue their personal interests. As a consequence, public expenditure and public debt are lower when citizens enjoy direct democratic rights. Citizens also feel more responsible for their community: tax evasion is lower in direct than in representative democratic systems. q 2000 Elsevier Science B.V. All rights reserved. JEL classification: H10; H30 Keywords: Direct democracy; Public expenditures; Public debt 1. Introduction Direct democracy has a considerable impact on Swiss political culture. Two political decisions illustrate that: on November 29, 1989, Swiss citizens voted on ) Corresponding author. Tel.: q 41-71-224-23-47; fax: q 41-71-224-22-98. Ž . E-mail address: gebhard.kirchgassner@unisg.ch G. Kirchgassner . ¨ 0176-2680r00r$ - see front matter q 2000 Elsevier Science B.V. All rights reserved. Ž . PII: S0176-2680 00 00003-3