Who does better for the economy? Presidents versus parliamentary democracies

Are certain forms of government associated with superior economic outcomes? This paper attempts to answer that question by examining how government systems influence macroeconomic performance. We find that presidential regimes consistently are associated with less favorable outcomes than parliamenta...

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Bibliographic Details
Published inPublic choice Vol. 176; no. 3/4; pp. 361 - 387
Main Authors McManus, Richard, Ozkan, F. Gulcin
Format Journal Article
LanguageEnglish
Published New York Springer Science + Business Media 01.09.2018
Springer US
Springer Nature B.V
Subjects
Economic growth
Economic models
Economics
Economics and Finance
Income inequality
Inflation
Macroeconomics
Political Science
Presidential systems
Presidents
Public Finance
Socioeconomics
Income inequality
Inflation
P16
Economic growth
E02
H11
Constitutional economics
Form of government
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Summary:Are certain forms of government associated with superior economic outcomes? This paper attempts to answer that question by examining how government systems influence macroeconomic performance. We find that presidential regimes consistently are associated with less favorable outcomes than parliamentary regimes: slower output growth, higher and more volatile inflation and greater income inequality. Moreover, the magnitude of the effect is sizable. For example, annual output growth is between 0.6 and 1.2 percentage points lower and inflation is estimated to be at least four percentage points higher under presidential regimes relative to those under parliamentary ones. The difference in distributional outcomes is even starker; income inequality is 12 to 24% worse under presidential systems.
ISSN:0048-5829
1573-7101
DOI:10.1007/s11127-018-0552-2