Crisis babies, inflation experience, and the electoral cycle evidence from Africa

Using a newly constructed dataset, this paper investigates the impact of early-life inflation experiences on political cycles in 30 African countries over the period from 1980 to 2020. We propose that central bankers who have weathered an inflation crisis during their formative years are less likely to adopt accommodative monetary policies during electoral periods. As a result, this diminishes or eliminates the occurrence of a political monetary cycle. Our empirical analysis substantiates this hypothesis. Importantly, it is not merely the presence of an inflation crisis in an African central banker's early life that matters; the intensity of these crises is a crucial determinant. Specifically, when central bankers have encountered multiple inflation crises during their childhood, political monetary cycles cease to exist.