Political cycles and economic performance in OECD countries: empirical evidence from 1951-2006

Niklas Potrafke

MPRA Paper from University Library of Munich, Germany

Abstract: This paper examines whether electoral motives and government ideology influence short-term economic performance. I employ data on annual GDP growth in 21 OECD countries over the 1951-2006 period and provide a battery of empirical tests. In countries with two-party systems GDP growth is boosted before elections and, under leftwing governments, in the first two years of a legislative period. These findings indicate that political cycles are more prevalent in two-party systems because voters can clearly punish or reward political parties for governmental performance. My findings imply that we need more elaborate theories of how government ideology and electoral motives influence short-term economic performance.

Keywords: political cycles; partisan politics; electoral motives; government ideology; short-term economic performance; panel data (search for similar items in EconPapers)
JEL-codes: C23 D72 O57 (search for similar items in EconPapers)
Date: 2009-12-29
New Economics Papers: this item is included in nep-cdm and nep-pol
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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https://mpra.ub.uni-muenchen.de/23751/1/MPRA_paper_23751.pdf original version (application/pdf)
https://mpra.ub.uni-muenchen.de/23834/1/MPRA_paper_23834.pdf revised version (application/pdf)

Related works:
Journal Article: Political cycles and economic performance in OECD countries: empirical evidence from 1951–2006 (2012)
Working Paper: Political cycles and economic performance in OECD countries: Empirical evidence from 1951-2006 (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:23751

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