Hostname: page-component-745bb68f8f-kw2vx Total loading time: 0 Render date: 2025-01-08T22:25:36.029Z Has data issue: false hasContentIssue false
  • English
  • Français

A Model of the Political Economy of the United States

Published online by Cambridge University Press:  02 September 2013

Alberto Alesina ,
John Londregan  and
Howard Rosenthal
Alberto Alesina
Affiliation:
Harvard University
John Londregan
Affiliation:
Princeton University
Howard Rosenthal
Affiliation:
Carnegie Mellon University
Get access Rights & Permissions [Opens in a new window]

Abstract

We develop and test a model of joint determination of economic growth and national election results in the United States. The formal model, which combines developments in the rational choice analysis of the behavior of economic agents and voters, leads to a system of equations in which the dependent variables are the growth rate and the vote shares in presidential and congressional elections. Our estimates support the theoretical claims that growth responds to unanticipated policy shifts and that voters use both on-year and midterm elections to balance the two parties. On the other hand, we find no support for “rational” retrospective voting. We do reconfirm, in a fully simultaneous framework, the “naive” retrospective voting literature's finding that the economy has a strong effect on presidential voting. We find congressional elections unaffected by the economy, except as transmitted by presidential coattails.

Type
Articles
Information
American Political Science Review , Volume 87 , Issue 1 , March 1993 , pp. 12 - 33
Copyright
Copyright © American Political Science Association 1993

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Alesina, Alberto. 1987. “Macroeconomic Policy in a Two-Party System as a Repeated Game.” Quarterly Journal of Economics 102:651–78.CrossRefGoogle Scholar
Alesina, Alberto. 1988. “Macroeconomics and Politics.” National Bureau of Economic Research Macroeconomic Annual 1988:11–55.Google Scholar
Alesina, Alberto, Cohen, Gerald, and Roubini, Nouriel. 1992. “Macroeconomic Policy and Elections in OECD Democracies.” Economics and Politics 5:1–30.CrossRefGoogle Scholar
Alesina, Alberto, and Rosenthal, Howard. 1989. “Partisan Cycles in Congressional Elections and the Macroeconomy.” American Political Science Review 83:373–98.CrossRefGoogle Scholar
Alesina, Alberto, and Rosenthal, Howard. 1991. “A Theory of Divided Government.” Economics Department Working Paper No. 537. Massachusetts Institute of Technology.Google Scholar
Alesina, Alberto, and Roubini, Nouriel. 1992. “Political Cycles in OECD Economies.” Review of Economic Studies 59:663–88.CrossRefGoogle Scholar
Alesina, Alberto, and Sachs, Jeffrey. 1988. “Political Parties and the Business Cycle in the United States, 1948–1984. Journal of Money, Credit, and Banking 20:63–82.CrossRefGoogle Scholar
Balke, Nathan S., and Gordon, Robert J.. 1989. “The Estimation of Prewar Gross National Product: Methodology and New Evidence.” Journal of Political Economy 97:38–92.CrossRefGoogle Scholar
Barro, Robert, and Gordon, David. 1983. “Rules, Discretion, and Reputation in a Model of Monetary Policy.” Journal of Monetary Economics 12:101–22.CrossRefGoogle Scholar
Beck, Nathaniel. 1982. “Parties, Administrations, and American Macroeconomic Outcomes.” American Political Science Review 76:83–94.CrossRefGoogle Scholar
Beck, Nathaniel. 1992. “Political Business Cycles, What Have We Learned?” University of California, Irvine. Mimeo.Google Scholar
Bernheim, Douglas, Peleg, Bezael, and Whinston, Michael. 1987. “Coalition Proof Nash Equilibria.” Journal of Economic Theory 42:1–12.CrossRefGoogle Scholar
Calvert, Randall L., and Ferejohn, John A.. 1983. “Coattail Voting in Recent Presidential Elections.” American Political Science Review 77:407–16.CrossRefGoogle Scholar
Campbell, John Y., and Mankiw, N. Gregory. 1987. “Are Output Fluctuations Transitory?” Quarterly Journal of Economics 102:857–79.CrossRefGoogle Scholar
Chappell, Henry W., and Keech, William R.. 1988. “The Unemployment Consequences of Partisan Monetary Policy.” Southern Economic Journal 55:107–22.CrossRefGoogle Scholar
Chappell, Henry W., and Suzuki, Mototshi. 1990. “Aggregate Fluctuations for the U.S. Presidency, Senate, and House.” University of South Carolina. Mimeo.Google Scholar
Christiano, Larry, and Eichenbaum, Martin. 1989. “Unit Roots in GNP: Do We Know and Do We Care?” Federal Reserve Bank of Minneapolis. Mimeo.CrossRefGoogle Scholar
Cukierman, Alex. 1984. Inflation, Stagflation, Relative Prices, and Imperfect Information. Cambridge: Cambridge University Press.CrossRefGoogle Scholar
Cukierman, Alex, and Meltzer, Alan. 1986. “A Positive Theory of Discretionary Policy, the Cost of Democratic Government, and the Benefits of a Constitution.” Economic Inquiry 24:367–88.CrossRefGoogle Scholar
Enelow, James, and Hinich, Melvin. 1984. The Spatial Theory of Voting. Cambridge: Cambridge University Press.Google Scholar
Erikson, Robert. 1988. “The Puzzle of Midterm Loss.” Journal of Politics 50:1012–29.CrossRefGoogle Scholar
Erikson, Robert. 1989. “Economic Conditions and the Presidential Vote.” American Political Science Review 83:67–76.CrossRefGoogle Scholar
Erikson, Robert. 1990. “Economic Conditions and the Congressional Vote: A Review of the Macrolevel Evidence.” American Journal of Political Science 34:373–99.CrossRefGoogle Scholar
Fair, Ray. 1978. “The Effects of Economic Events on Votes for Presidents.” Review of Economics and Statistics 60:159–72.CrossRefGoogle Scholar
Fair, Ray. 1982. “The Effect of Economic Events on Votes for President: 1980 Results.” Review of Economic and Statistics 64:322–25.CrossRefGoogle Scholar
Fair, Ray. 1988. “The Effect of Economic Events on Votes for President: 1984 Update.” Political Behavior 10:168–79.CrossRefGoogle Scholar
Fiorina, Morris. 1981. Retrospective Voting in American National Elections. New Haven: Yale University Press.Google Scholar
Fiorina, Morris. 1988. “The Reagan Years: Turning Point to the Right or Creeping Towards the Middle.” In The Resurgence of Conservatism in Anglo–American Democracies, ed. Cooper, Barry et al. Durham: Duke University Press.Google Scholar
Fiorina, Morris. 1992. Divided Government. New York: Macmillan.Google Scholar
Fischer, Stanley. 1977. “Long Term Contracts, Rational Expectations, and the Optimal Money Supply Rule.” Journal of Political Economy 85:191–206.CrossRefGoogle Scholar
Golden, David, and Poterba, James. 1980. “The Price of Popularity: The Political Business Cycle Reexamined.” American Journal of Political Science 24:696–714.CrossRefGoogle Scholar
Greenberg, Joseph. 1989. “Deriving Strong and Coalition-Proof Nash Equilibria from an Abstract System.” Journal of Economic Theory 49:195–202.CrossRefGoogle Scholar
Haynes, Stephen, and Stone, Joe. 1987. “Should Political Models of the Business Cycle Be Revived?” Working Paper No. 8716. University of Oregon.Google Scholar
Hibbs, Douglas. 1977. “Political Parties and Macroeconomic Policy.” American Political Science Review 71:1467–87.CrossRefGoogle Scholar
Hibbs, Douglas. 1987. The American Political Economy: Electoral Policy and Macroeconomics in Contemporary America. Cambridge: Harvard University Press.CrossRefGoogle Scholar
Jacobson, Gary. 1990. “Does the Economy Matter in Midterm Elections?” American Journal of Political Science 34:400–404.CrossRefGoogle Scholar
Kiewiet, D. Roderick. 1983. Macroeconomics and Micropolitics. Chicago: University of Chicago Press.Google Scholar
Kiewiet, D. Roderick, and Udell, Michael. 1991. “Back to the Beginning: A Reconsideration of the Electoral Effects of Short-Term Economic Fluctuations.” Presented at the annual meeting of the Midwestern Political Science Association, Chicago.Google Scholar
Kramer, Gerald. 1971. “Short Term Fluctuations in U.S. Voting Behavior, 1896–1964.” American Political Science Review 65:131–43.CrossRefGoogle Scholar
Kydland, Finn, and Prescott, Edward. 1977. “Rules Rather than Discretion: The Inconsistency of Optimal Plans.” Journal of Political Economy 85:473–490.CrossRefGoogle Scholar
Lepper, Susan. 1974. “Voting Behavior and Aggregate Policy Targets.” Public Choice 18:67–82.CrossRefGoogle Scholar
McCallum, Bennett. 1978. “The Political Business Cycle: An Empirical Test.” Southern Economic Journal 44:504–15.CrossRefGoogle Scholar
Mankiw, N. Gregory, Miron, Jeffrey A., and Weil, David N.. 1987. “The Adjustment of Expectations to a Change in Regime: A Study of the Founding of the Federal Reserve.” American Economic Review 77:358–74.Google Scholar
Nelson, Charles R., and Plosser, Charles T.. 1982. “Trends and Random Walks in Macroeconomic Time Series.” Journal of Monetary Economics 10:139–62.CrossRefGoogle Scholar
Nordhaus, William. 1975. “The Political Business Cycle.” Review of Economic Studies 42:169–90.CrossRefGoogle Scholar
Nordhaus, William. 1989. “Alternative Approaches to Political Business Cycles.” Paper on Economic Activity No. 2. Brookings Institution.CrossRefGoogle Scholar
Persson, Torsten, and Tabellini, Guido. 1990. Macroeconomic Policy, Credibility, and Politics. New York: Harwood Academic.Google Scholar
Popkin, Samuel. 1991. The Reasoning Voter: Communication and Persuasion in Presidential Campaigns. Chicago: University of Chicago Press.CrossRefGoogle Scholar
Rogoff, Kenneth, and Sibert, Anne. 1988. “Elections and Macroeconomic Policy Cycles.” Review of Economic Studies 55:1–16.CrossRefGoogle Scholar
Romer, Christina D. 1989. “The Prewar Business Cycle Reconsidered: New Estimates of Gross National Product, 1869–1908.” Journal of Political Economy 97:1–37.CrossRefGoogle Scholar
Romer, Christina, and Romer, David. 1989. “Does Monetary Policy Matter—a New Test in the Spirit of Friedman and Schwartz.” Macroeconomic Annual. Cambridge: National Bureau of Economic Research.Google Scholar
Rothemberg, Thomas J. 1973. “Efficient Estimations with A Priori Information.” Cowles Foundation Monograph No. 23. New Haven: Yale University Press.Google Scholar
Taylor, John B. 1980. “Aggregate Dynamics and Staggered Contracts.” Journal of Political Economy 88:1–23.CrossRefGoogle Scholar
Tobin, James. 1972. “Inflation and Unemployment.” American Economic Review 62:1–18.Google Scholar
Tufte, Edward B. 1978. Political Control of the Economy. Princeton: Princeton University Press.CrossRefGoogle Scholar
Submit a response

Comments

No Comments have been published for this article.