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Popular media and politicians have often blamed the high public debt of some EU countries on cultural differences. These claims are most apparent in the discourse contrasting ostensibly prudent Northern Europeans with spendthrift Southern Europeans. Despite the prominence of these and similar narratives and evidence that culture plays a nontrivial...
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... answer this question, we use effect decomposition to establish how much of the variance is driven by between-country, in contrast to within-country, differences. Table 1 presents this analysis. We find that cross-country differences only account for about 3.9% of the variance in attitudes towards debt preferences. ...Similar publications
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