Political Business Cycles and Democratization: Evidence From Sub-Saharan Africa

The literature on Political Business Cycles (PBCs) has suffered from two limitations, namely a dominant focus on government policies rather than outcomes that could influence voter behaviour, and a lack of attention to the relationship between PBCs and democratization. Using multiple fine-grained data on objective and subjective outcomes we examine the nature of PBCs in Sub-Saharan Africa, a region which has experienced substantial levels of democratization in recent decades. We demonstrate clear evidence for the existence of PBCs in Sub-Saharan Africa and that the nature of the PBC changes with democratization. Specifically, we show that PBCs in non-democracies focus more on the provision of private goods and less on public goods, with this reversing as countries democratize. These findings, which hold across data sources and are robust to various specifications, have important implications for our understanding of the link between elections and development outcomes in Sub-Saharan Africa and beyond.