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The Lost Popularity Function: Are Unemployment and Inflation no longer Relevant for the Bahaviour of German Voters?

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  • Gebhard Kirchgässner

Abstract

Up to now there was a general conviction that increasing unemployment and inflation have a negative impact on the government’s popularity. This was true for Germany as well, but it does not seem to hold any longer. This paper first reviews the results of earlier periods before presenting new results for the last part of the Kohl government after unification and for the Schröder government. While the results for the former show the known pattern, neither unemployment nor inflation is significant in the equations of the Schröder government, the latter has even the wrong sign. The missing impact of unemployment might be due to statistical reasons: the short observation period and the low variance of the explanatory variables. With respect to inflation, however, the citizens might have recognised that they cannot any longer hold the government responsible as the European Central Bank is performing monetary policy in Europe since 1999 and is, therefore, also responsible for price stability in Germany.

Suggested Citation

  • Gebhard Kirchgässner, 2009. "The Lost Popularity Function: Are Unemployment and Inflation no longer Relevant for the Bahaviour of German Voters?," CESifo Working Paper Series 2882, CESifo Group Munich.
  • Handle: RePEc:ces:ceswps:_2882
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    References listed on IDEAS

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    1. Vaubel, Roland, 1997. "The bureaucratic and partisan behavior of independent central banks: German and international evidence," European Journal of Political Economy, Elsevier, vol. 13(2), pages 201-224, May.
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    3. Ammermüller, Andreas & Zwick, Thomas & Boockmann, Bernhard & Maier, Michael, 2007. "Do hiring subsidies reduce unemployment among the elderly? Evidence from two natural experiments," ZEW Discussion Papers 07-001, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    4. Nannestad, Peter & Paldam, Martin, 1994. "The VP-Function: A Survey of the Literature on Vote and Popularity Functions after 25 Years," Public Choice, Springer, vol. 79(3-4), pages 213-245, June.
    5. Engle, R. F. & Granger, C. W. J. (ed.), 1991. "Long-Run Economic Relationships: Readings in Cointegration," OUP Catalogue, Oxford University Press, number 9780198283393.
    6. van Riel, Arthur & Schram, Arthur, 1993. "Weimar Economic Decline, Nazi Economic Recovery, and the Stabilization of Political Dictatorship," The Journal of Economic History, Cambridge University Press, vol. 53(01), pages 71-105, March.
    7. Muller, Ulrich K., 2005. "Size and power of tests of stationarity in highly autocorrelated time series," Journal of Econometrics, Elsevier, vol. 128(2), pages 195-213, October.
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    Cited by:

    1. Roth, Felix & Nowak-Lehmann D., Felicitas & Otter, Thomas, 2011. "Has the financial crisis shattered citizens’ trust in national and European governmental institutions? Evidence from the EU member states, 1999-2010," CEPS Papers 4159, Centre for European Policy Studies.
    2. Berlemann, Michael & Enkelmann, Sören, 2014. "The economic determinants of U.S. presidential approval: A survey," European Journal of Political Economy, Elsevier, vol. 36(C), pages 41-54.
    3. Roth, Felix & Jonung, Lars & Nowak-Lehmann D.,Felicitas, 2011. "The Enduring Popularity of the Euro throughout the Crisis," CEPS Papers 6512, Centre for European Policy Studies.
    4. repec:exl:25engi:v:27:y:2016:i:1:p:4-12 is not listed on IDEAS

    More about this item

    Keywords

    government popularity; popularity function; Germany; unemployment; inflation;

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government

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