POLITICAL AND PARTISAN CYCLES IN THE AUSTRALIAN ECONOMY *

POLITICAL AND PARTISAN CYCLES IN THE AUSTRALIAN ECONOMY * I. INTRODUCIION In this paper we examine the extent to which political factors affect macroeconomic variables in the Australian economy. In particular, we answer three related sets of questions. Firstly, to what extent do incumbent governments manipulate the economy in order t raise their probability o of winning an election? Secondly. to what extent do policy makers take advantage of economic circumstances in choosing the timing of elections? Finally, is there any difference in the performance of the macroeconomy under Liberal, and under Labor governments in Australia? We use time-series econometric techniques t address these questions, and focus on Federal o elections in post-war Australia. These techniques allow us to uncover any statistically significant differences in the performance of the economy around election times, and under different political parties. While the (statistically) small number of elections makes inference somewhat hazardous, we find little evidence of political manipulation of the economy. or of partisan differences in the performance of the economy. The only exception to this conclusion is a statistically significant rise in government consumption and government capital investment in the four quarters prior to elections. The finding that there is little evidence of political or electoral cycles in http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Australian Economic Papers Wiley

POLITICAL AND PARTISAN CYCLES IN THE AUSTRALIAN ECONOMY *

Loading next page...
1
 
/lp/wiley/political-and-partisan-cycles-in-the-australian-economy-1B6z6Ln5ug
Publisher
Wiley
Copyright
1997 BLP/University of Adelaide/Finders University
ISSN
0004-900X
eISSN
1467-8454
D.O.I.
10.1111/j.1467-8454.1997.tb00819.x
Publisher site
See Article on Publisher Site

Abstract

I. INTRODUCIION In this paper we examine the extent to which political factors affect macroeconomic variables in the Australian economy. In particular, we answer three related sets of questions. Firstly, to what extent do incumbent governments manipulate the economy in order t raise their probability o of winning an election? Secondly. to what extent do policy makers take advantage of economic circumstances in choosing the timing of elections? Finally, is there any difference in the performance of the macroeconomy under Liberal, and under Labor governments in Australia? We use time-series econometric techniques t address these questions, and focus on Federal o elections in post-war Australia. These techniques allow us to uncover any statistically significant differences in the performance of the economy around election times, and under different political parties. While the (statistically) small number of elections makes inference somewhat hazardous, we find little evidence of political manipulation of the economy. or of partisan differences in the performance of the economy. The only exception to this conclusion is a statistically significant rise in government consumption and government capital investment in the four quarters prior to elections. The finding that there is little evidence of political or electoral cycles in

Journal

Australian Economic PapersWiley

Published: Jun 1, 1997

References

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 18 million articles from more than
15,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Search

Query the DeepDyve database, plus search all of PubMed and Google Scholar seamlessly

Organize

Save any article or search result from DeepDyve, PubMed, and Google Scholar... all in one place.

Access

Get unlimited, online access to over 18 million full-text articles from more than 15,000 scientific journals.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve

Freelancer

DeepDyve

Pro

Price

FREE

$49/month
$360/year

Save searches from
Google Scholar,
PubMed

Create folders to
organize your research

Export folders, citations

Read DeepDyve articles

Abstract access only

Unlimited access to over
18 million full-text articles

Print

20 pages / month

PDF Discount

20% off