Skip to main content
Article thumbnail
Location of Repository

Candidate entry, screening, and the political budget cycle

By Eric Le Borgne and Ben Lockwood


We investigate whether relevant private information about citizens’ competence in political office can be credibly revealed by their entry and campaign expenditure decisions, as opposed to choice of policy once in office. We find that this depends on whether voters and candidates have common or conflicting interests; only in the former case can entry be revealing in equilibrium. We apply these results to Rogoff’s (1990) model of the political budget cycle, allowing for candidate entry, as well as elections: as interests are common, low-ability candidates are screened out at the entry stage, and so there is no signaling via fiscal policy (i.e. no “political budget cycle”). In a variant of the Rogoff. model where citizens differ in honesty, rather than ability, interests are conflicting, and so the political budget cycle can persist in equilibrium

Topics: HC, JA
Publisher: University of Warwick, Department of Economics
Year: 2001
OAI identifier:

Suggested articles


  1. (2000a), Political Economy in Macroeconomics,
  2. (1993). Adverse Selection and Moral hazard in a Repeated Elections Model”,
  3. (1997). An Economic Model of Representative Democracy ”, doi
  4. (1997). Campaign Advertising and Voter Welfare”, mimeo, London School of Economics.
  5. (2000). Campaign Spending With Office-Seeking Politicians, Rational Voters, and Multiple Lobbies”, mimeo, London School of Economics. doi
  6. (1985). Candidates, Parties, and Campaigns: Electoral Politics in America, Congressional Quarterly Press,
  7. (1997). Capital Account Liberalization as a Signal”, doi
  8. (1995). Does Electoral Accountability Affect Economic Policy Choices? Evidence From Gubernatorial Term Limits ”, doi
  9. (2001). Does Tax Competition Raise Voter Welfare?”, mimeo London School of Economics.
  10. (1993). Economic Policy, Economic Performance, doi
  11. (1989). Electoral Accountability and Incumbency”,
  12. (1990). Equilibrium Political Budget Cycles”, doi
  13. (1998). Government and Politics Of The United States, (second edition)
  14. (1986). Incumbent Performance and Electoral doi
  15. (1987). Interest Groups, Campaign Contributions, and Probabilistic Voting”, doi
  16. (1995). On the Form of Transfers to Special Interests”, doi
  17. (1991). Optimal Accommodation by Strong Policymakers Under Incomplete Information”, doi
  18. (1998). Optimal Retention in Agency Problems”, doi
  19. (2000). Political Economics: Explaining Economic Policy, doi
  20. (1986). Reputation in a Model of Monetary Policy with Incomplete Information”, J o u r n a lo fM o n e t a r yE c o n o m y doi
  21. (1987). Signaling games and Stable Equilibria”, doi
  22. (1986). Signalling in a Model of Monetary Policy with Incomplete Information”, doi
  23. (1998). Sources of Inefficiency in a Representative Democracy: A Dynamic Analysis”,
  24. (1991). The American Political Process, doi
  25. (1973). The Control of Politicians: an doi
  26. (1999). The Electoral Effects of Incumbent Wealth”, doi
  27. (2000). The Political Business Cycle After 25 Years”. Forthcoming in: doi
  28. (1995). War Politics: An Economic, Rational Voter Framework”,
  29. (2000). When are Plurality Rule Voting Games Dominance Solvable?”, mimeo doi
  30. (1998). When Does It Take a Nixon to Go to China?”,
  31. (1989). Why Democracies Produce Efficient Results”, doi

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.