Political business cycles in a democracy

Seminar paper from the year 2012 in the subject Politics - International Politics - Topic: Globalization, Political Economics, printed single-sided, grade: 2,7, Christian-Albrechts-University of Kiel (Institut für Sozialwissenschaften), course: Governing the crisis: how democracies deal with adverse economic conditions, language: English, comment: There are few researches which are directly devoted to the role of the political business cycles (PBC) in economic crises. The given term paper contains the research about the implications which are derived from the PBC and stay before political parties during the times of crises. The definition of the PBC, the different concepts of interactions between voters and parties as well as the role of political business cycles in the crises are revealed. This all serve the base for the revealing of the implications for political parties during the crises which depend on the type of the party. , abstract: Various economic difficulties and economic crises can be challenges for democratic political systems. In some cases it can lead to social cataclysms and even destruction of political systems. In this connection, different political actors offer different programs in order to solve current socio-economic problems.However, according to the modern economic theory the free market economy develops cyclical, and the period of recession always comes after the recovery. There is the conception of political business cycles, which confirm it. Nevertheless political parties often have to carry out the policies and even take part in elections in conditions of economic crises. In some cases they even have to change their programs or significantly correct them in order to keep their voters. In this way, the problem of this term paper is the following one: what are the implications for political parties if they stand for elections in times of crises and their behavior towards voters is either opportunistic or ideological?In order to give the answer for this question which is actual for the current European sovereign debt crisis it is first of all necessary to define political business cycle and to describe their models, which also include the concepts of the parties behavior as well as their interaction with voters and issues. Then the role of political business cycles in the economic crises will be explained. The understanding of the nature of political business cycles and the activities of political parties in them reveal the implications which the parties face by elections in times of crises. It can be also helpful for overcoming the consequences of the crisis with simultaneously saving of political stability.