Given that Nordhaus' political business cycle theory is relevant at election cycle frequency and that its validity can change over time, we consider wavelet analysis especially suited to test the theory. For the postwar U.S. economy, we exploit wavelet methods to demonstrate whether there...

Viewing fiscal policies as the outcome of democratically resolved conflicts of households over public goods and taxes, the “economic model of politics” proposes a public choice approach, which does not rely on social welfare functions. With it, a country’s overall budget can be derived...

There is a wide range of theories that try to explain interactions between politics end economy that are referred as political cycles. Majority of these theories aims at analysis of changes in economic outcomes that are related to elections or other phenomena in the political reality. To induce...

Drawing from the personal tape recordings made during the presidency of Richard Nixon, we uncover and report in this paper new evidence that Nixon manipulated Arthur Burns and the Federal Reserve Bank into creating a political business cycle that helped secure Nixon’s reelection victory in...

This paper uses two-dimensional asymmetric Taylor reaction functions for 16 OECD-countries to account for different reactions to the inflation rate and output by central banks before or after an election of the fiscal authorities in the respective country. Important for such an investigation is...

This paper uses two-dimensional asymmetric Taylor reaction functions for 16 OECD-countries to account for different reactions to the inflation rate and output by central banks before or after an election of the fiscal authorities in the respective country. Important for such an investigation is...