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Is the political business cycle for real?

  • Blomberg, S. Brock
  • Hess, Gregory D.

This paper's macroeconomic model combines features from both real and political business cycle models. It augments a standard real business cycle tax model by allowing for varying levels of government partisanship and competence in order to replicate two important empirical regularities: First, that on average the economy expands early under Democratic presidents and contracts early under Republican presidents. Second, that presidents whose parties successfully retain the presidency have stronger-than-average growth in the second half of their terms. The model generates both of these features in conformity with U.S. post-World War II data.

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Article provided by Elsevier in its journal Journal of Public Economics.

Volume (Year): 87 (2003)
Issue (Month): 5-6 (May)
Pages: 1091-1121

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Handle: RePEc:eee:pubeco:v:87:y:2003:i:5-6:p:1091-1121
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505578

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