Presidential Elections and the Econonmy 1872 to 1996: The Times they are a 'Changin or the Song Remains the Same?

Abstract

Scholars have argued that economic conditions influence presidential elections because Presidents have some influence over macroeconomic performance. Most research on the impact of the economy on presidential elections has focused on the period after World War II because of the dramatic increase in govemment power over the economy from 1932 to 1946. Research on politics during the late 19th and early 20th centuries has focused more on the impact of cultural forces on elections. However, no one has tested the stability of the relationship between economic conditions and presidential elections over time to see if increases in presidential power between 1932 and 1946 increased the impact of the economy on presidential elections. In this work I test the stability of the relationship between the economy and presidential elections over time using OLS regression and F-tests to show that macroeconomic conditions have influenced presidential elections from 1872 to 1996 and that the importance of changes in GNP did increase significantly after 1946. These results conceming 1946 are consistent with previous work. I also show that govemment was involved in many politically important economic policies before 1946, which might also explain why economic conditions influenced presidential elections in the late 19th and early 20th century.