The most recent issue of Public Choice has some interesting work in it.

A paper by Gary Wagner and Russell Sobel underscores the importance of details with institutional design. From campaign finance to public finance, there's more to a reform than whatever catchy name they dream up for it, and there's usually a pig somewhere beneath the lipstick and wig it's dressed up in. In this case, many states began adopting rainy day funds in the early 1980s, ostensibly to stabilize revenue and spending during economic cycles. From the paper's introduction:

What has traditionally been overlooked, however, is that the rash of stabilization
fund adoptions during the 1980s also coincided with the “tax revolt”
era of increased fiscal constraints such as tax and expenditure limit
laws (hereafter, “TELs”). While TELs are typically thought of as constraints
aimed at limiting the growth in expenditures and/or tax revenue, some TELs
have the potential to be tremendously influential as to the manner in which
states save. Several expenditure limit laws and some tax limit laws, such as
California’s expenditure limit law (Proposition 13) for instance, require some
or all of a general fund surplus to be returned to citizens. In cases such as
this, the adoption of a budget stabilization fund into which the general fund
surplus may be placed effectively circumvents the constraint imposed by the
TEL.

And from a few pages later:

...the rash of stabilization fund adoptions in the 1980s was preceded by the adoption of numerous spending limit laws and a handful of tax limit laws. Only Hawaii, Montana, and Oregon currently have a TEL in place and are without a stabilization fund. Of the 23 states that have both a stabilization fund and an expenditure and/or tax limit law, 19 of these states had an expenditure and/or tax limit law in place before adopting a stabilization fund...

Gary and Russ categorize the states based on how stringently policymakers are constrained (by TEL or other) regarding budget surpluses. In a 1945-1996 panel, they estimate states' adoption decisions. Results show that stricter restraints increase the likelihood of adoption. Recession variables matter, too, but less so. Interestingly, the stricter restraints are best at explaining adoption by statute (i.e. by policymakers). The evidence suggests that rainy day funds were more about policymaker discretion than macro smoothing. At the very least, the paper undermines the standard wisdom that rainy day funds were public interest responses to the 1980-82 business cycle.

On a side note, Russ was out here to SJSU a couple of weeks ago. He presented a very cool paper (with Brian Osoba) on youth gangs as pseudo governments that are caused by, rather than causing, violence.

Craig and his UTA colleague Courtney Lafountain have an article in the same issue that is noteworthy in that it examines corruption at the U.S. state level. More corrupt state, lower bond rating, higher interest rate for taxpayer debt. No bueno.

On a dubious note, an article appears as such:

Rudiger Ahrend and Carlos Winograd, "The political economy of mass privatisation and imperfect taxation: Winners and loosers"

(open URL here) And no, it's not studying those who cut loose but those who lose out.