Temporal Aggregation in Political Budget Cycles

Serie Documentos de Trabajo, No. 403

39 Pages Posted: 10 Oct 2009

See all articles by Jorge M. Streb

Jorge M. Streb

Universidad del CEMA

Daniel Lema

Universidad del CEMA

Date Written: August 1, 2009

Abstract

While existing cross-country studies on political budget cycles rely on annual data, we build a panel with quarterly and monthly data from Latin American and OECD countries over the 1980-2005 period. Disaggregated data allow to center the electoral year more precisely, and show the effects are concentrated in a three-quarter window around elections. Cycles are statistically significant only in Latin America, but the pattern is similar to OECD countries: the budget surplus/GDP ratio falls in the election period and rises in the post-election period. In line with the logic of rational opportunistic manipulation, these effects cancel out.

Keywords: temporal aggregation, electoral window, pre- and post-electoral effects, political budget cycles, rational opportunistic cycles

JEL Classification: D72, D78, H60

Suggested Citation

Streb, Jorge Miguel and Lema, Daniel, Temporal Aggregation in Political Budget Cycles (August 1, 2009). Serie Documentos de Trabajo, No. 403, Available at SSRN: https://ssrn.com/abstract=1485702 or http://dx.doi.org/10.2139/ssrn.1485702

Jorge Miguel Streb (Contact Author)

Universidad del CEMA ( email )

Av. Cordoba 374
Buenos Aires, CABA
Argentina

HOME PAGE: http://www.ucema.edu.ar/u/jms/

Daniel Lema

Universidad del CEMA ( email )

1054 Buenos Aires
Argentina

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