The authors extend the "rational partisan" model of inflation to allow for the effects of unemployment persistence on the dynamics of inflation. The authors combine this model with the "exchange-rate-regime" model of inflation, and examine the experience of the United Kingdom. Outside the fixed...

This paper presents a two-party model of fiscal and debt policy in which the parties do not care about policy outcomes when out of office. Unlike other models of this type, the authors' model has predictions that are largely consistent with existing empirical findings about partisan and...