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- Title
THE POLITICAL BUSINESS CYCLE: A REEXAMINATION OF SOME EMPIRICAL EVIDENCE.
- Authors
McGavin, Brian H.
- Abstract
The political business cycle usually is accepted as a stylized fact of democratic industrial countries. Several papers, however, have brought the existence of the political business cycle into question. Perhaps the most prominent and widely cited is McCallum [11]. McCallum theorizes that the political business cycle is inconsistent with rational expectations cum natural rate hypothesis. His evidence supports this conjecture. This paper investigates the effects of changing several features of McCallum's methodology. The results indicate that inferences from these tests regarding the political business cycle are sensitive to the underlying assumptions. Inferences based on McCallum's work are tenuous.
- Subjects
BUSINESS cycles; ECONOMICS
- Publication
Quarterly Journal of Business & Economics, 1987, Vol 26, Issue 1, p36
- ISSN
0747-5535
- Publication type
Article