During Republican administrations, the year during the
term (first, second, third, fourth) is a powerful determinant of
economic growth. Counting the election year as year 0, year 4 is
always one of strong growth and years 2 and 3 of weaker growth.
There is a fair amount of variation within the columns, but no
particular second or third year is as high as the average
fourth year, nor any individual fourth year as low as the average
second or third year. Nor is any second or third year as high as the
following fourth year. The ranking of the first year is not reliable; it
can be the highest or the lowest in growth.
| Election Year | Offset | |||
|---|---|---|---|---|
| +1 | +2 | +3 | +4 | |
| 1968 | 3.09% | 0.17% | 3.36% | 5.29% |
| 1972 | 5.76 | -0.50 | -0.19 | 5.33 |
| 1980 | 2.52 | -1.94 | 4.52 | 7.19 |
| 1984 | 4.13 | 3.47 | 3.38 | 4.13 |
| 1988 | 3.54 | 1.88 | -0.17 | 3.33 |
| 2000 | 0.75 | 1.60 | 2.70 | 4.22 |
| Mean | 3.30 | 0.78 | 2.27 | 4.91 |
| Standard Deviation | 1.67 | 1.92 | 1.98 | 1.35 |
The mean economic growth for all years with a Republican president from 1960 to 2004 is 2.81.
This pattern is unlikely to be caused by chance. For a fuller
analysis, see Alternative
Explanations.
While I'll leave the statistical analysis there, a few
comments on the exceptional nature of economic performance
during presidential election years of Republican administrations
might be in order Four percent, or better, might be considered
"good growth." (4% is something close to the median rate.) The
economy performed that well during five (of six) fourth years of
Republican administrations and only three (of 18) other years. Were
growth even for the four years of a presidential term, 25%
(very slightly less, due to compounding) of the growth
would occur during the fourth year of the term. In fact, all six
Republican terms had more than 25% of their growth in the fourth
year. Five of the six had more than 30% of their growth during the
fourth year.
As the fourth year is the presidential election year, the
hypothesis that this pattern is a result of deliberate, planned, action
tempts one. Further consideration makes this hypothesis less
persuasive. The second year is , after all, a year of
Congressional elections. The president wants and needs
more congressmen of his party. On the other hand, he has less
reason to want a successor of his party. Moreover, two of the three
slowest fourth-year growths were when incumbents were running --
including the weakest growth of all.