Macro-economic decision-making in Norway: an analysis of economic decisions within the politico-economic framework

Summary. The aim of the study is to analyze when and why Norwegian governments carry out expansive decisions rather than contractive ones. Following the politico-economic approach, it is proposed that both the governmental re-election prospects and economic indicators may influence macro-economic decision making.
The article attempts to employ this framework in an empirical analysis of events data, i.e. in an analysis of 318 decision events spread throughout the period from 1964 to 1984. Unemployment is the major determinant of macro-economic policies. The hypothesis of political business-cycle receives only limited empirical support, and there is little reliable evidence of socialist governments responding differently to economic and political factors compared to borgeois governments.