Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/123147
Authors: 
Aidt, Toke
Asatryan, Zareh
Badalyan, Lusine
Heinemann, Friedrich
Year of Publication: 
2015
Series/Report no.: 
CESifo Working Paper 5508
Abstract: 
We study the short-run effect of elections on monetary aggregates in a sample of 85 low and middle income democracies (1975-2009). We find an increase in the growth rate of M1 during election months of about one tenth of a standard deviation. A similar effect can neither be detected in established OECD democracies nor in other months. We argue that the cycle is related to systemic vote buying which requires significant amounts of cash at election times. The finely timed increase in M1 is consistent with this and it cannot be, fully, accounted for by alternative explanations.
Subjects: 
political business cycles
vote buying
monetary economies
JEL: 
D72
E51
O10
Document Type: 
Working Paper

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