Perceptions of macroeconomic performance, government support and Conservative Party strategy in Britain 1983–1987

Abstract

Abstract. This paper examines the relationship between macroeconomic performance and party popularity for the Conservative government of Margaret Thatcher in Britain from 1983 to 1987. A popularity function is estimated which shows that government support was significantly influenced by inflation and unemployment; perceptions and expectations of economic performance; and a variety of non‐economic variables and political shocks. A monetary policy reaction function is also estimated which shows that the Conservative government manipulated the money supply in order to stimulate the economy in the election year. Finally, an outcome function is estimated showing that monetary policy had a significant influence on inflation and unemployment. The results demonstrate that the Conservatives pursued a strategy of manipulating the economy for political profit, in a way consistent with the political business cycle.

Government Performance and Political Accountability at Subnational Level: The Electoral Fate of Local Incumbents in Norway

“…Increased levels of unemployment and/or inflation and decreased levels of economic growth are all negatively related to the support for incumbent parties, and this relationship has been demonstrated at national aggregate levels with real economic figures as well as by individual-level data in several countries (e.g. Alt 1979;Jonung & Wadensjö 1979;Hibbs 1979;1982;1987;Schneider 1984;Miller & Listhaug 1984;Norpoth 1984;Clarke & Whiteley 1990;Warwick 1992;Anderson 1995;Huseby 2000).…”

Error‐correction models of party support: The case of new labour

“…Later work on the short-term dynamics of party support (for example, Whiteley, 1984;Clarke and Whiteley, 1990) solved this problem by modelling all of the relevant variables in the model in first-differenced form, that is, as a change over adjacent time periods (AX, = X t -X tA ). A variable Downloaded by [Simon Fraser University] at 18:44 05 June 2016 such as the retail price index, for example, is very likely to fluctuate around a constant mean when modelled in first-differenced, instead of its original level, form.…”

The impact of parties, economic growth, and public sector expansion: a comparison of long–term dynamics in the scandinavian and anglo–american democracies

“…To capture this feedback process, a reaction function and an outcome function will be integrated within the same econometric model. Whereas a reaction function captures how the government's use of policy instruments is affected by macroeconomic (and political) variables, the outcome function describes economic results (or targets) as a consequence of the manipulation of policy instruments (Clarke & Whiteley 1990: 1077. Public spending, revenues, GNP as well as an indicator of economic openness are included as endogenous variables.…”