Mr. Smith and the economy: the influence of economic conditions on individual legislator voting

This paper estimates the influence of macroeconomic conditions on individual legislator voting over time. Previous work shows legislator voting to be stable over careers. In this paper, voting on an ideological issue space (ADA scores) and a fiscal issue space (NTU scores), from 1976 to 2002, exhibits significant short-term cyclicality with economic conditions. Individual legislators polarize by party in response to rising unemployment, and converge in response to rising inflation. As legislators accumulate tenure, they become more ideologically conservative but more fiscally liberal. Results are also reported on presidential party, divided government, and region. All results are weaker in the Senate than in the House.     

MPs' Pay 1911–1996: Myths and Realities

The controversial 26 per cent salary increase voted for by MPs in July 1996 re-ignited the vexed issue of politicians and pay. This paper firstly develops a framework to review the history of MPs' pay. Secondly, an empirical examination is undertaken with regard to its value relative to prices and earnings, the ruling political party and the overall period disaggregated by decade. This suggests that MPs have been more successful insulating themselves against the ravages of inflation than changes in earnings and that the party in power appears to be influential.     

Russian Voting and the Initial Economic Shock of Hyperinflation

This paper addresses the issue of economicvoting in transitional democracies using data from the Russianfederal elections. It argues that the shock of inflation thatfollowed the fundamental economic reform has a lastinginfluence on voters. Specifically, it shows that in Russia,where inflationary policy led to hyperinflation and thewidespread loss of personal savings, the magnitude of savingslost at that time continues to explain a significant portionof the variation in the regional support for the Communistparty in parliamentary and presidential elections.     

新会计准则下公司利润调节空间的变形及应对策略

2006年初,我国孕育3年之久的新会计准则终于破茧而出,并于2007年1月1日起首先在上市公司中推行,随后将逐步推广到所有公司。新准则与国际准则趋同,涵盖各类企业各项经济业务,可独立实施。新准则在旧准则基础上作了重大的调整和补充,填补了我国会计领域中诸多空白。本文系统地探讨了新会计准则下公司利润调节和机会主义盈余管理空间的变化,并针对这些变化,较全面地提出了应对策略。     

Granger causality,rational expectations and aversion to unemployment and inflation

This paper presents a new test for rational expectations. This is done within the context of public concern, or aversion, over inflation and unemployment. It is found that inflation aversion Granger causes inflation, but unemployment aversion does not Granger cause unemployment. This implies both that inflation aversion is partially determined by expected inflation and that such expectations have a rational element. However, rational expectations of unemployment do not determine unemployment aversion. The consequences of these results for political business cycle theory are then examined.     

Median Voter Preferences,Central Bank Independence and Conservatism

This paper studies how the independence and theconservatism of a central bank relate to the structureand stability of the median voter preferences. This isdone by means of a model of endogenous delegationwhere an opportunistic policy maker chooses themonetary regime (independence and conservatism) tomaximise the welfare of the median voter. The resultsshow that a high degree of inflation aversion ofmonetary policy is not necessarily associated with ahigh degree of central bank independence. A high andstable degree of inflation aversion of society (i.e.of the median voter) may lead to establish a dependentcentral bank which is highly inflation averse. This suggests that the negativecorrelation between inflation and central bankindependence indices detected by several empiricalstudies may reflect a link between inflation and somedeep features of social preferences.     

An analysis of voter predictive dimensions and recovery of the underlying issue space

Based on the spatial voting model posited by Enelow and Hinich, this paper presents a means of determining the nature of the issue dimensions used by voters. This method allows for calculation of the extent to which the predictive dimensions recover the underlying issues space. Of particular interest is the extent to which a single predictive dimension can recover the issue space. The method also suggests that Enelow and Hinich are correct in their hypothesis that the social liberal-conservative axis and the economic liberal-conservative axis are the dimensions most used by the electorate.     

Endangering alliance or risking proliferation?: US–Japan and US–Korea nuclear energy cooperation agreements

This paper seeks to understand why the United States treated Japan and Korea differently in the revisions of bilateral nuclear cooperation agreements. On the sensitive issue of grating its allies the rights of developing enrichment and reprocessing (ENR), the United States did so for Japan in the 1977 and 1987 revisions, but did not for Korea during the 2015 revision. For the great power as a supplier state, there are two factors affecting the decision: policy-makers’ concern about alliance management prior to the calculation of security outcome, and firms’ commercial interests. In order to avoid damage to the US–Japan alliance and to maintain Japan's complementation for the US nuclear industry, Washington granted the rights of ENR to Tokyo. In contrast, because of its confidence of managing the US–Korea alliance and partly because of incompatibility of commercial interests between the two, Washington did not grant the rights to Seoul at the 2015 revision. Based on the comparison of the two cases, this paper underscores a need to alter the power projection theory regarding nuclear proliferation by explicating the alliance management as the ex ante element of power projection and by accounting for commercial interests such as fuel sale and technological partnership.     

Information Resources Management Expenditures in the States: A Case for Integrating Accounting and Budgeting Systems

A recent national study has found that states may be spending $20 billion on information resources management (IRM) in FY1989. The significant findings of the study regarding financial management are highlighted to show the dimensions of the IRM expenditures in the states. The second part of the paper examines how well the states' accounting systems are able to provide data on IRM expenditures for budgetary decisions. The article expands upon an important issue raised in the study's findings: the need for better integration of accounting and budgeting systems to improve management of information resources. An Information Object Classification Scheme, first suggested by the Commission on Federal Paperwork, is proposed as an important step in helping states improve their information resources management.     

Electoral Rules,Labor Market Coordination and Macroeconomic Performance

Two distinct literatures have studied the macroeconomic effects of electoral systems and of labor market structures, respectively. Results include a positive association between proportional representation (PR) electoral systems and growth, but also between PR and inflation, as well as negative or hump‐shaped relationships between labor market coordination and the ‘misery variables’, unemployment and inflation. However, these results could be biased; particular electoral system and labor market features co‐vary systematically, and extant studies have typically not taken this into account. Effects attributed to PR systems could really stem from labor market coordination, and vice versa. In this article the relationships with macroeconomic outcomes for both electoral systems and labor market structures are re‐evaluated by modelling them jointly. Employing data from more than 30 democracies, with time‐series from the period 1960–2010, some robust and some non‐robust associations are identified. First, PR systems are, indeed, associated with higher growth rates, but not with higher inflation. Regarding labor market coordination, robust curvilinear relationships with unemployment and inflation are identified; intermediate levels of coordination correspond with worse macroeconomic performance – albeit not lower growth – even when accounting for electoral system features.     

ACCRUAL ACCOUNTING VALUATIONS AND ACCOUNTABILITY IN GOVERNMENT: A POTENTIALLY PERNICIOUS UNION

Abstract: With the movement towards decentralisation of control over governmental trading activities much attention has been placed by politicians and economists on a loosely attached rate of return control philosophy. Independent boards are appointed to government business entities, generally comprising business managers and private sector directors who are experienced in profit generation and micro- economic planning. This thrust has now been facilitated by accounting standards with a private sector orientation. These favour accrual valuations with their associated resource allocations and guidelines for funds distribution. However, the extent of the subjectivity introduced by such measures has now placed many parliamentary conventions at risk. Such subjectivity also contributes to the lack of goal congruence and financial control in government which in turn can counteract macroeconomic planning and control as this is at present practised and understood. This paper examines normatively some of the theoretical defects and conventional heresies associated with these new allocative and distributional arrangements.     

Accounting for failure in the nationalised enterprises — coal,steel and cars since 1970

This paper analyses the nature of the strategic miscalculations in nationalised British coal, steel and cars since the early 1970s. Specifically, it examines the extent to which the initial strategic miscalculations were caused by an uncritical use of return on investment (ROI) techniques and the extent to which subsequent operational retreat was determined by profit and loss considerations. The general conclusion is that financial (mis)calculation was a secondary problem in enterprises which did not identify their productive problems and could not solve their market difficulties. In our three cases, large-scale investment was futile when the state did not safeguard the market for the final product.     

Exposure Draft, February 1981

Editor's Note: In February 1981 the Governmental Accounting Standards Board Organization Committee (GASBOC) recommended the establishment of a governmental accounting standards board. Its exposure draft will be the subject of intense examination in the coming months. Shortly after the draft was issued, the Financial Accounting Foundation, which is involved in accounting standards for private organizations, called for a single group to set standards for both public and private entities. Much more is involved than the jurisdictional issue of whether a single or a dual structure should be established for accounting standards. Once in operation, these standards will shape governmental accounting and reporting practices, much in the way that standards now dictate the accounting procedures of private firms. Many state and local governments will have to revamp their accounting structures in order to satisfy the new standards. At issue also is the question of whether standards should primarily satisfy the needs and interests of external users or those of the governmental unit. Should governments be accountable principally through the political process or through externally enforced rules? This question goes to the heart of American democracy. The way it is answered will not only influence financial management, but also the conduct and quality of government. In order to encourage informed debate, excerpts from berth the GASBOC exposure draft and the FAF statement are published here. In addition, a selected bibliography by James Chan should help readers work their way through the maze of accounting standards.     

Political instability and inflation volatility

The purpose of this paper is to empirically analyze the effects of political instability, social polarization and the quality of institutions on inflation volatility over time and across countries. Using the system-GMM estimator for linear dynamic panel data models on a sample covering 160 countries, analyzed in the period from 1960 to 1999, this paper finds that higher degrees of political instability and social polarization, less democracy, and lower de facto central bank independence are associated with more volatile inflation rates. Furthermore, political instability has greater effects on inflation volatility in developing countries with lower degrees of central bank independence and economic freedom.     

Partisan Differences in Swedish Macroeconomic Policy

The purpose of this paper is to trace partisan differencesamong Swedish governments during the period 1958-2000. According tothe Partisan Theory of macroeconomic policy left-wing governmentsare relatively more concerned with the performance of the realside of the economy (real output and unemployment) as compared toright-wing governments, that place a higher weight on the nominalvariables (inflation). Left-wing governments would therefore pursue moreexpansionary aggregate demand policy, and thereby be willingto risk a higher inflation, in order to improve real economicperformance. In this paper we apply the model developed in Hibbs (1994) onSwedish data. Our empirical results support the partisan theory,showing that, ceteris paribus, aggregate demand policy under left-winggovernments is relatively more expansionary than under right-wing governments, even if the expansionary policysometimes leads to higher inflation.     

The marketing profession: evolution and future

• Marketing claims professional status and presents to the broader community as professional. The paper draws on previous contributions to the broader issue of professionalism and uses the examples from law, medicine and accounting to argue that the attempt has been neither completely successful nor easily demonstrable. Five criteria common to well‐known and accepted professions are developed. The paper concludes that marketing is yet to achieve professional status and asks whether such status is essential for marketers.

Copyright © 2006 John Wiley & Sons, Ltd.     

Central bank independence and inflation: Corporatism,partisanship, and alternative indices of central bank independence

A well-developed theoretical literature suggests that central bank independence causes low inflation. Empirical work supporting this hypothesis is unsatisfactory, however, for two reasons: statistical analysis has only recently begun to include control variables, and important political variables that are related to inflation have not yet been included; analysis has not yet undertaken a systematic comparison of alternative indices of central bank independence. This paper addresses both weaknesses by testing the explanatory power of eight indices of central bank independence in a political-economic model of inflation. The results suggest that while support for the central bank independence hypothesis survives a relatively inclusive set of control variables, support for the hypothesis is not independent of the particular index upon which analysis relies.     

Domestic political determinants of inflation

Abstract. Political economists have advanced a variety of diverse and competing hypotheses to explain the domestic political dimension of inflation. With few exceptions, however, these hypotheses have been tested individually without regard to competing explanations. This study uses pooled time-series data on fifteen industrial democracies to examine five prominent political hypotheses that purport to explain either political pressures that cause inflation or institutional arrangements that insulate governments from these pressures. The results indicate that: (1) Central Bank independence provides an effective counterweight to inflation by insulating monetary policy making from inflationary (particularly, partisan) impulses; (2) Government spending increases caused by distributive and redistributive politics intensify inflationary pressures even in countries with independent Central Banks and neocorporatist arrangements; (3) Inflation is determined partially by the ideology of the party controlling government. Leftist governments in pursuit of income redistribution produce higher inflation than conservative governments; (4) Elections do not have significant effects on inflation under any structural circumstances; and (5) Neocorporatism does not consistently reduce inflation or contain the inflationary effects of partisan manipulation and fiscal expansion. However, neocorporatism may stop inflation if wage moderation by labour is accompanied by the government's commitment to pursue restrictive monetary policy.     

Exaggerating good governance: Regime type and score inflation among executive survey informants

Researchers and policymakers often rely on executive surveys to understand and promote good governance. In doing so, they assume that the evaluations provided by these well‐informed respondents are not systematically influenced by regime type. However, regime‐embedded executives often have a personal stake in the survey outcomes, incentivizing them to exaggerate good governance. This paper compares World Economic Forum Executive Opinion Survey responses to corollary measures of key governance concepts in democracies, anocracies, and autocracies. It finds evidence of significant score inflation among executives in closed regimes. The individual‐level mechanisms are explored in one autocracy by comparing responses from regime‐embedded informants based at firms headquartered within the country with those managing businesses headquartered abroad. These micro‐level data likewise reveal evidence of widespread inflation, particularly on items related to governance. Finally, a closer look at Transparency International's Corruption Perceptions Index demonstrates the broader impact Executive Opinion Survey inflation for measuring governance within closed regimes.     

Who does better for the economy? Presidents versus parliamentary democracies

Are certain forms of government associated with superior economic outcomes? This paper attempts to answer that question by examining how government systems influence macroeconomic performance. We find that presidential regimes consistently are associated with less favorable outcomes than parliamentary regimes: slower output growth, higher and more volatile inflation and greater income inequality. Moreover, the magnitude of the effect is sizable. For example, annual output growth is between 0.6 and 1.2 percentage points lower and inflation is estimated to be at least four percentage points higher under presidential regimes relative to those under parliamentary ones. The difference in distributional outcomes is even starker; income inequality is 12 to 24% worse under presidential systems.