Government competence, economic performance and endogenous election dates

Empirical research in comparative politics has largely demonstrated that fa vorable economic conditions improve the electoral fortunes of incumbent gov ernment parties. Thus, in parliamentary democracies in which the government can choose when to call an election there is an incentive for government p arties to act strategically by calling early elections when economic condit ions are favorable. Alesina, Cohen and Roubini, however, cast doubt on this proposition, finding only weak evidence of a relationship between economic factors and election timing. In this paper, we reconsider the relationship between economic conditions and endogenous election dates using new data, controlling for political factors, and applying more appropriate econometri c techniques. From analyses of twelve parliamentary democracies, we find th at macroeconomic performance and political context exert significant influe nce on election timing. All other factors being equal, better performances in terms of economic growth, inflation, and unemployment will make a govern ment more likely to call an early election. Controlling for government ideo logy, we find that right-wing governments are more sensitive to inflation p erformance while left-wing governments are more sensitive to the lever of u nemployment. (C) 2000 Elsevier Science Ltd. All rights reserved.