Premium
INFLATION AND ELECTIONS: THEORY AND EVIDENCE FOR SIX OECD ECONOMIES
Author(s) -
Carlsen Fredrik
Publication year - 1999
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/j.1465-7295.1999.tb01420.x
Subject(s) - economics , inflation (cosmology) , business cycle , keynesian economics , general election , monetary economics , politics , macroeconomics , political science , physics , theoretical physics , law
This paper examines the relation between post‐election inflation and the incumbent's re‐election chances using data for 50 elections in six OECD economies. Ijnd that post‐election inflation is above average if the election race is close but not if the incumbent's election prospects are very good or very poor. The theoretical part of the paper shows that this result is consistent with rational political business cycle models. ( JEL E31)