A Simultaneous Model of Politico‐economic Interaction in Sweden, 1970–82*

Abstract

This paper contains a critique of much Of the work on politico‐economic models. These models are criticized on four grounds: that they should have a more explicit economic structure, that they should be estimated by systems estimators to prevent simultaneity bias, that they should be subjected more to full‐model simulations, and that the estimations should be carried out over each election period separately better to reveal parameter instability. The hypotheses are tested on a monthly model of Sweden for the period 1970–82. It turns out that the interaction between the economy and the polity in this period is so small that the first three points of criticism are irrelevant. Estimated parameters in the evaluation function and in the policy function(s) are, however, so unstable as to cast doubt on the relevance of politico‐economic models. This does not deny that there may be an interaction on specific instances, but there does not appear to be a systematic relationship.

Explaining the growth of government in Sweden: A disequilibrium approach

“…A close scrutiny of the results from these regressions led us to infer that the following variables were of little explanatory value and could be excluded: URBAN, XM, DUMSOC and UNEMPL. The insignificance of UNEMPL is consistent with the findings in Lybeck (1985). In a second step the model was reestimated with these variables excluded.…”

The Journal of Public Policy in perspective

“…There is some evidence that weak coalition governments escape blame for poor economic performance when stronger, single-party , majority governments could not (Paldam and Schneider, 1980;Lybeck , 1985). On the other hand, these governments may be subject to collaps e at any time because one or more parties does not wis h to be associate d with an unpopular policy choice.…”

Economics and the Left Party Vote in Scandinavia: A Cross‐National Analysis

“…Again, however, the emphasis is on parties in power, rather than the party vote per se. The majority of survey-based time-series studies report mixed results across Scandinavian countries, over time, and across di¡erent macroeconomic indicators, whether in Denmark (Nannestad & Paldam 1994), Norway (Miller & Listhaug 1985), or Sweden (Lybeck 1985;Hibbs & Madsen 1981;Jonung & Wadensjo 1979). Taken together, what the bulk of these studies highlight is that ¢ndings for a relationship between economic conditions and incumbent support are weak and inconsistent.…”