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Why Has US Policy Uncertainty Risen since 1960?

Author

Listed:
  • Scott R. Baker
  • Nicholas Bloom
  • Brandice Canes-Wrone
  • Steven J. Davis
  • Jonathan Rodden

Abstract

We consider two classes of explanations for the rise in policy-related economic uncertainty in the United States since 1960. The first stresses growth in government spending, taxes, and regulation. A second stresses increased political polarization and its implications for the policymaking process and policy choices.

Suggested Citation

  • Scott R. Baker & Nicholas Bloom & Brandice Canes-Wrone & Steven J. Davis & Jonathan Rodden, 2014. "Why Has US Policy Uncertainty Risen since 1960?," American Economic Review, American Economic Association, vol. 104(5), pages 56-60, May.
    • Handle: RePEc:aea:aecrev:v:104:y:2014:i:5:p:56-60
    Note: DOI: 10.1257/aer.104.5.56
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    References listed on IDEAS

    as
    1. N. Bloom, 2016. "Fluctuations in uncertainty," Voprosy Ekonomiki, NP Voprosy Ekonomiki, issue 4.
    2. John Dawson & John Seater, 2013. "Federal regulation and aggregate economic growth," Journal of Economic Growth, Springer, vol. 18(2), pages 137-177, June.
    3. David S. Lee & Enrico Moretti & Matthew J. Butler, 2004. "Do Voters Affect or Elect Policies? Evidence from the U. S. House," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 119(3), pages 807-859.
    4. Canes-Wrone, Brandice & Park, Jee-Kwang, 2012. "Electoral Business Cycles in OECD Countries," American Political Science Review, Cambridge University Press, vol. 106(1), pages 103-122, February.
    5. Stephen Ansolabehere & Jonathan Rodden & James M. Snyder Jr., 2006. "Purple America," Journal of Economic Perspectives, American Economic Association, vol. 20(2), pages 97-118, Spring.
    6. Jacob Jensen & Ethan Kaplan & Suresh Naidu & Laurence Wilse-Samson, 2012. "Political Polarization and the Dynamics of Political Language: Evidence from 130 Years of Partisan Speech," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 43(2 (Fall)), pages 1-81.
    7. Jacob Jensen & Ethan Kaplan & Suresh Naidu & Laurence Wilse-Samson, 2012. "Political Polarization and the Dynamics of Political Language: Evidence from 130 Years of Partisan Speech," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 45(2 (Fall)), pages 1-81.
    8. Nolan McCarty & Keith T. Poole & Howard Rosenthal, 2009. "Does Gerrymandering Cause Polarization?," American Journal of Political Science, John Wiley & Sons, vol. 53(3), pages 666-680, July.
    9. Hirano, Shigeo & Snyder, James M. & Ansolabehere, Stephen & Hansen, John Mark, 2010. "Primary Elections and Partisan Polarization in the U.S. Congress," Quarterly Journal of Political Science, now publishers, vol. 5(2), pages 169-191, August.
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    More about this item

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • E23 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Production
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E61 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Policy Objectives; Policy Designs and Consistency; Policy Coordination
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation

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