The Political Economy of Wage and Price Controls: Evidence from the Nixon Tapes
On August 15, 1971, Richard Nixon imposed the first and only peacetime wage and price controls in U.S. history. The Nixon tapes, personal tape recordings made during the presidency of Richard Nixon, are now available to the public and provide a unique body of evidence to investigate the motivations for Nixon’s macroeconomic policies. We have uncovered and report in this paper evidence that Nixon manipulated both monetary and fiscal policies to create a political business cycle that helped secure his reelection victory in 1972. Nixon was very knowledgeable about economic matters and understood the risks to the economy of his macroeconomic policy actions and the imposition of wage and price controls, but chose to tradeoff longer-term economic costs to the economy for his own short-term political gain.
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- Burton A. Abrams & James L. Butkiewicz, 2011.
"The Political Business Cycle: New Evidence from the Nixon Tapes,"
11-05, University of Delaware, Department of Economics.
- Burton A. Abrams & James L. Butkiewicz, 2012. "The Political Business Cycle: New Evidence from the Nixon Tapes," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 44, pages 385-399, 03.
- Burton A. Abrams, 2006.
"How Richard Nixon Pressured Arthur Burns: Evidence from the Nixon Tapes,"
06-04, University of Delaware, Department of Economics.
- Burton A. Abrams, 2006. "How Richard Nixon Pressured Arthur Burns: Evidence from the Nixon Tapes," Journal of Economic Perspectives, American Economic Association, vol. 20(4), pages 177-188, Fall.
- William D. Nordhaus, 1975. "The Political Business Cycle," Review of Economic Studies, Oxford University Press, vol. 42(2), pages 169-190.
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