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International Impacts on Domestic Political Economy: A Case of Japanese General Elections

Takatoshi Ito ()

No 3499, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The objective of this paper is twofold. First, this paper emphasizes that in a parliamentary system, such as in Japan, election timings become endogenous, in that good economic performances tend to trigger elections. Second, impacts of international factors, such as foreign exchange reserves and elections of the United States, on domestic economic performances will be examined in the context of political business cycles. This paper finds only a limited link between economic performances and international variables, except one that upcoming elections in the United States tend to cause a higher rate of growth in Japan. Evidence suggests that although blatant policies, such as a beggar-thy-neighbor policy, were not adopted, a more subtle international cooperation, in the form of Japanese expansion to pill up the United States economy, have been used.

Date: 1990-10
Note: ME
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Published as Journal of International Money and Finance, Vol. 10, pp. S73-S89, (1991).

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