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Qualifications to Political Business Cycle Models

The paper analyses the principal four model types that comprise the political business cycle literature. Political business cycle models can be classified according to the political motivations of opportunism and ideology as well as by the nature of the expectations that individuals are assumed to hold. Using this classification we pay particular attention to the underlying assumptions of the models. The paper concludes that a satisfactory model while incorporating the possibility of both ideological and opportunistic behaviour must also consider the appropriate indicator to which government reacts. Any errors within the article are wholly mine and should be addressed as should all welcome comments to myself at the Public Sector Economics Research Centre, University of Leicester, University Road, Leicester LE1 7RH, U.K.