IDEAS home Printed from https://ideas.repec.org/p/hhs/hastef/0009.html
   My bibliography  Save this paper

Political Cycles and Cyclical Policies. A New Test Approach Using Fiscal Forecasts

Author

Listed:
  • Ohlsson, Henry
  • Vredin, Anders

    (Dept. of Economics, Stockholm School of Economics)

Abstract

We test how government revenue and expenditure depend on economic activity, elections, and ideology. We show how the use of fiscal forecasts makes it possible better to understand the determinants of fiscal variables and to separate fiscal policy rules from discretionary policies. The approach is illustrated using a unique, unpublished Swedish data set of fiscal forecasts and forecasts of economic activity. Revenue varies positively with nominal earnings, expenditure varies negatively with real GDP. We find partisan effects, but no political business cycle effects. Revenue and expenditure are lower with non-Social democratic governments. The partisan effect on revenue is stronger than on expenditure. Using another unique data set, we find that there are autonomous decisions behind the reaction of expenditure, but not of revenue, to activity.

Suggested Citation

  • Ohlsson, Henry & Vredin, Anders, 1994. "Political Cycles and Cyclical Policies. A New Test Approach Using Fiscal Forecasts," SSE/EFI Working Paper Series in Economics and Finance 9, Stockholm School of Economics.
    • Handle: RePEc:hhs:hastef:0009
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:bla:scandj:v:98:y:1996:i:2:p:203-18 is not listed on IDEAS
    2. Susanna-maria Paleologou, 2005. "Political manoeuvrings as sources of measurement errors in forecasts," Journal of Forecasting, John Wiley & Sons, Ltd., vol. 24(5), pages 311-324.

    More about this item

    Keywords

    Fiscal forecasts; fiscal policy; policy reaction functions; feedback; autonomous decisions; partisan theories; political business cycles;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H60 - Public Economics - - National Budget, Deficit, and Debt - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hhs:hastef:0009. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Helena Lundin (email available below). General contact details of provider: https://edirc.repec.org/data/erhhsse.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.