Refereed Articles
Unemployment and Inflation Consequences of Unexpected Election Results
Michael Berlemann, Gunther Markwardt (2007),
Journal of Money, Credit & Banking 39(8), 1919-1945.
Journal of Money, Credit & Banking 39(8), 1919-1945.
The empirical evidence toward rational partisan theory of business cycles is mixed and thus inconclusive. This is due to the enormous heterogeneity of the existing empirical studies. Only a few of these test explicitly for the central theoretical innovation that post-electoral blips in economic activity depend on the degree of the electoral surprise. Using polling data we present empirical evidence in favor of rational partisan theory for a panel of OECD countries.