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Berlemann, Michael
Markwardt, Gunther
Year of Publication: 
Series/Report no.: 
Dresden Discussion Paper Series in Economics No. 01/03
Rational partisan theory of political business cycles suggests differences in inflation under left-wing and right-wing governments. It also suggests temporary post-electoral booms after election of left-wing governments and temporary recessions after election of right-wing ones. However, the core hypothesis that post-electoral booms and recessions depend upon the degree of pre-electoral uncertainty has rarely been tested. Using pre-electoral polling data, we provide empirical evidence in favor of the hypothesis of the existence of rational partisan cycles. We also show that - in line with most previous empirical studies - there is little evidence for partisan cycles under adaptive expectations.
partisan theory
political business cycles
Document Type: 
Working Paper

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