Is the political business cycle for real?
Stephen Blomberg () and
Gregory Hess ()
No 16, Working Papers (Old Series) from Federal Reserve Bank of Cleveland
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.
Keywords: Business; cycles (search for similar items in EconPapers)
Date: 2000, Revised 2000
New Economics Papers: this item is included in nep-dge, nep-pbe and nep-pol
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Journal Article: Is the political business cycle for real? (2003)
Working Paper: Is the Political Business Cycle for Real? (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedcwp:0016
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