Journal ArticleDOI
Politics and business cycles in industrial democracies
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TLDR
Alesina et al. as mentioned in this paper showed that the degree of politico-institutional stability and the independence of the Central Bank have a bearing on macroeconomic outcomes. But they also pointed out that the combination of partisanship and electoral cycles may easily result in socially undesirable outcomes.Abstract:
Politics
Alberto Alesina
Influences from political competition on macroeconomic policy are often thought to be a source of economic fluctuations. Politicians are described as being driven by two, not mutually exclusive, main motivations: they want to be reelected and they harbour political, or ideological, biases. When such theories are confronted with actual cycles in a number of industrial countries, the pattern of inflation, unemployment, output, and budget deficits indicates that partisan policy making is a fairly widespread phenomenon, with more limited evidence that electoral preoccupations result in major fluctuations. The combination of partisanship and electoral cycles may easily result in socially undesirable outcomes. In particular the degree of politico-institutional stability and the independence of the Central Bank have a bearing on macroeconomic outcomes. These observations raise a number of important questions about the design of political institutions.read more
Citations
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Journal ArticleDOI
Central Bank Independence and Macroeconomic Performance: Some Comparative Evidence
TL;DR: The authors used information on a sample of sixteen OECD countries to assess the relationship between central bank independence and macroeconomic performance, and found little evidence that political control of central bank policy has any impact on measures of the level or variability of growth, unemployment, or ex ante real interest rate.
Journal ArticleDOI
The Political Economy of Budget Deficits
Alberto Alesina,Roberto Perotti +1 more
TL;DR: A critical survey of the literature on politico-institutional determinants of the government budget can be found in this paper, where the authors discuss the tax smoothing model and conclude that this approach alone cannot provide complete answers to these questions.
Journal ArticleDOI
Insider–Outsider Politics in Industrialized Democracies: The Challenge to Social Democratic Parties
TL;DR: The authors argue that the goals of social democratic parties are often best served by pursuing policies that benefit insiders while ignoring the interests of outsiders and analyze Eurobarometer data and annual macrodata from 16 OECD countries from 1973 to 1995, concluding that insider-outsider politics are fundamental to a fuller explanation of government partisanship, policy-making, and social democracy since the 1970s.
Posted Content
Political Cycles in OECD Economies
Alberto Alesina,Nouriel Roubini +1 more
TL;DR: In this paper, the authors investigate whether the dynamic behavior of GNP growth, unemployment, and inflation is systematically affected by the timing of elections and of changes of governments, and they explicitly test the implication of several models of political cycles, both of the opportunistic and of the partisan type.
Journal ArticleDOI
Does Inflation Targeting Matter
TL;DR: In this article, the authors studied the inflation and interest rate performances for six former high-inflation countries that adopted inflation targeting (IT) in the early 1990's, using Germany, Switzerland and the US for comparison.
References
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TL;DR: In this paper, it was shown that discretionary policy does not result in the social objective function being maximized, and that there is no way control theory can be made applicable to economic planning when expectations are rational.
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Rules, Discretion and Reputation in a Model of Monetary Policy
TL;DR: In this article, the authors develop an example of a reputational equilibrium where the out-comes turn out to be weighted averages of those from discretion and those from the ideal rule.
Journal ArticleDOI
Rules, discretion and reputation in a model of monetary policy
Robert J. Barro,David B. Gordon +1 more
TL;DR: In this paper, the authors develop an example of a reputational equilibrium where the outcomes turn out to be weighted averages of those from discretion and those from the ideal rule, when the discount rate is high.