Date of Original Version
Abstract or Description
T'HREE strands of thought and conjecture contribute to the belief that economic conditions play an important, and perhaps decisive role in elections. Recent theories of rational voting behavior—Buchanan and Tullock1 or Riker and Ordeshook2 are examples—treat votes and voting as the outcome of a rational calculation of marginal costs and benefits. Prosperity, rising real income and increased employment may, in this framework, yield benefits to the individual that can be translated into votes for the party or candidate. Related, yet distinct, is the growing body of conjectures about a "political business cycle." High employment and low inflation in election years are followed by anti-inflation policies that temporarily lower employment and the rate of inflation in succeeding years. These policies work gradually and are replaced by policies to stimulate the economy, so the candidate or party can boast of prosperity and lower inflation at the next election. The conjecture arises also from casual and impressionistic evidence and from some studies of voting. Perhaps the most widely cited recent example is the Kennedy-Nixon election of 1960 when a small plurality and rising unemployment seemed to support the conjecture.
Journal of Law and Economics , 18, 3, 781-798.