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CAN THE PRESIDENT REALLY AFFECT ECONOMIC GROWTH? PRESIDENTIAL EFFORT AND THE POLITICAL BUSINESS CYCLE
Author(s) -
Rohlfs Chris,
Sullivan Ryan,
McNab Robert
Publication year - 2015
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/ecin.12111
Subject(s) - presidential system , economics , incentive , business cycle , gross domestic product , politics , affect (linguistics) , presidential election , product (mathematics) , monetary economics , macroeconomics , market economy , political science , linguistics , philosophy , geometry , mathematics , law
Presidential elections are often seen as referendums on the health of the economy; however, little evidence exists on the president's ability to influence gross domestic product (GDP). This study examines the effect of the incentive to be reelected and the resulting increase in presidential effort on GDP growth. Growth is found to rise in reelection years for first‐term presidents after 1932 and to fall in election years before 1932, when reelection was uncommon, and for second‐term presidents generally. This effect is largest for high‐quality presidents—who probably have the highest return to effort—and is spread across multiple sectors of the economy. (JEL D78, D72, E32, J24)