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The Political Business Cycle and Republican Administrations: an Empirical Investigation

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  • David W. Findlay

    (Colby College)

Abstract

This article examines the effects of the political business cycle on unemployment for the first quarter of 1951 through the fourth quarter of 1987. The results for the autoregressive model provide empirical support for the existence of a political business cycle during Republican administrations. A number of simulations are presented to illustrate the longer-term effects of the political business cycle on unemployment for this model and for the 1986 model offered by Allen, Sulock, and Sabo. These results suggest that the unemployment effects of the electoral cycle are not only statistically significant, but are also economically significant.

Suggested Citation

  • David W. Findlay, 1990. "The Political Business Cycle and Republican Administrations: an Empirical Investigation," Public Finance Review, , vol. 18(3), pages 328-338, July.
    • Handle: RePEc:sae:pubfin:v:18:y:1990:i:3:p:328-338
    DOI: 10.1177/109114219001800305
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    References listed on IDEAS

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    1. Allen, Stuart D, 1986. "The Federal Reserve and the Electoral Cycle: A Note," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 18(1), pages 88-94, February.
    2. Hibbs, Douglas A., 1977. "Political Parties and Macroeconomic Policy," American Political Science Review, Cambridge University Press, vol. 71(4), pages 1467-1487, December.
    3. Alberto Alesina, 1988. "Macroeconomics and Politics," NBER Chapters, in: NBER Macroeconomics Annual 1988, Volume 3, pages 13-62, National Bureau of Economic Research, Inc.
    4. William D. Nordhaus, 1975. "The Political Business Cycle," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 42(2), pages 169-190.
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    Cited by:

    1. Eric Dubois, 2016. "Political business cycles 40 years after Nordhaus," Public Choice, Springer, vol. 166(1), pages 235-259, January.
    2. Eric Dubois, 2016. "Political Business Cycles 40 Years after Nordhaus," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-01291401, HAL.
    3. Can Sever & Emekcan Yucel, 2020. "Macroprudential Policy and Elections: What Matters? Abstract:," Working Papers 2020/01, Bogazici University, Department of Economics.
    4. Can Sever & Emekcan Yucel, 2021. "Electoral Cycles in Inequality Abstract:," Working Papers 2021/01, Bogazici University, Department of Economics.
    5. Eric Dubois, 2016. "Political Business Cycles 40 Years after Nordhaus," Post-Print hal-01291401, HAL.
    6. Sever, Can & Yücel, Emekcan, 2022. "The effects of elections on macroprudential policy," Journal of Comparative Economics, Elsevier, vol. 50(2), pages 507-533.

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