Modelling of the political business cycle and the impact of transparency
- This paper models the political budget cycle with stochastic differential equations. The paper highlights the development of future volatility of the budget cycle. In fact, I confirm the proposition of a less volatile budget cycle in future. Moreover, I show that this trend is even amplified due to higher transparency. These findings are new evidence in the literature on electoral cycles. I calibrate a rigorous stochastic model on public deficit-to-GDP data for several countries from 1970 to 2012.
| Author of HS Reutlingen | Herzog, Bodo |
|---|---|
| URN: | urn:nbn:de:bsz:rt2-opus4-16907 |
| Handle: | http://hdl.handle.net/11159/537 |
| Erschienen in: | Economic and social development : 19th International Scientific Conference on Economic and Social Development ; book of proceedings , Melbourne, 9-10 February 2017 |
| Publisher: | Development and Entrepreneurship Agency |
| Place of publication: | Varazdin, Croatia |
| Editor: | Goran Kozina |
| Document Type: | Conference proceeding |
| Language: | English |
| Publication year: | 2017 |
| Tag: | political budget cycle; stochastic modelling; transparency |
| Page Number: | 11 |
| First Page: | 197 |
| Last Page: | 207 |
| DDC classes: | 330 Wirtschaft |
| Open access?: | Ja |
| Licence (German): |  Open Access |
