Economic Policy and Performance in Industrial Democracies: Party Governments, Central Banks and the Fiscal-Monetary Policy Mix, 1st Edition (Paperback) book cover

Economic Policy and Performance in Industrial Democracies

Party Governments, Central Banks and the Fiscal-Monetary Policy Mix, 1st Edition

By Takayuki Sakamoto


334 pages | 83 B/W Illus.

Purchasing Options:$ = USD
Paperback: 9780415572279
pub: 2009-11-24
Hardback: 9780415774147
pub: 2008-01-31

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This book is the first systematic study of how the interdependence of fiscal and monetary policies and the interaction of party governments and central banks affect the fiscal-policy mix in eighteen industrial democracies in North America, Western Europe, Japan and Oceania. Sakamoto argues that central banks’ influence on economic policy is far more extensive than has been conventionally believed. He demonstrates that central banks systematically affect fiscal policy that is conducted by party governments, and that independent central banks restrain the latter’s fiscal policy.

Sakamoto also demonstrates that the economic policy of industrial democracies did really change from the 1960s-1970s to the 1980s-1990s and became conservative as a result of the globalization of the economy and governments’ response to it. But he argues that despite the neo-liberal policy shift, globalization has not diminished the role of domestic politics in economic policy.


"This book considers the joint choice of monetary and fiscal policy by monetary and fiscal authorities, the central bank and the government, which are separate entities with differing objectives insofar as the former is independent of the latter. It considers the combination of multiple characteristics of these governments and their institutional-structural environments—left/right partisanship, fractionalization, labour-market organization and institutions, and election-year incentives—in explaining these policy choices. No previous work in political science of which I am aware gives as serious and sustained attention to this political economy of the joint fiscal/monetary choices of policymakers in as richly contextualized institutional-structural environments."

Robert J. Franzese, Jr., Associate Professor of Political Science, The University of Michigan

Table of Contents

1. Introduction 2. Party Governments-Central Banks Interaction: The Fiscal-Monetary Policy Mix 3. Change in the Economic Environment, Political Actors and Adjustment 4. The Political-Economic Determinants of Economic Policy and Outcomes: Basic Empirical Results 5. Party Governments, Central Banks and Labor: Empirical Evidence for Interactive Effects 6. Conclusion

About the Author

Takayuki Sakamoto is assistant professor of political science at Southern Methodist University (USA).

About the Series

Routledge Frontiers of Political Economy

In recent years, there has been widespread criticism of mainstream economics. This has taken many forms, from methodological critiques of its excessive formalism, to concern about its failure to connect with many of the most pressing social issues. This series provides a forum for research which is developing alternative forms of economic analysis. Reclaiming the traditional 'political economy' title, it refrains from emphasising any single school of thought, but instead attempts to foster greater diversity within economics.

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Subject Categories

BISAC Subject Codes/Headings:
BUSINESS & ECONOMICS / Economic History
BUSINESS & ECONOMICS / Economics / General