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Working Paper
The Effect of Local Economic Shocks on Local and National Elections
We study the reaction of voters to shifts in local economic conditions. Using the departure from the gold standard of US trading partners in 1931 and the US in 1933, we exploit heterogeneity in export destinations, creating local differences in expenditure-switching in US counties by isolating the aggregate effects of the monetary shocks using time fixed effects. We find significant changes in local voting behavior in response to both shocks, one originating abroad, and another domestically. The response to both shocks have similar magnitude. We argue that voters punished and rewarded ...
Working Paper
Theodore Roosevelt, the Election of 1912, and the Founding of the Federal Reserve
This paper examines how the election of 1912 changed the makeup of Congress and led to the Federal Reserve Act. The decision of Theodore Roosevelt and other Progressives to run as third-party candidates split the Republican Party and enabled Democrats to capture the White House and Congress. We show that the election produced a less polarized Congress and that new members were more likely to support the Act. Absent the Republican split, Republicans would likely have held the White House and Congress, and enactment of legislation to establish a central bank would have been unlikely or ...
Working Paper
Theodore Roosevelt, the Election of 1912, and the Founding of the Federal Reserve
This paper examines how the election of 1912 changed the makeup of Congress and led to the Federal Reserve Act. The decision of Theodore Roosevelt and other Progressives to run as third-party candidates split the Republican Party and enabled Democrats to capture the White House and Congress. We show that the election produced a less polarized Congress and that newly-elected members were more likely to support the act. Absent their interparty split, Republicans would likely have held the White House and Congress, and any legislation to establish a central bank would have been unlikely or ...
Working Paper
The Heterogeneous Effects of Government Spending : It’s All About Taxes
This paper investigates how government spending multipliers depend on the distribution of taxes across households. We exploit historical variations in the financing of spending in the U.S. since 1913 to show that multipliers are positive only when financed with more progressive taxes, and zero otherwise. We rationalize this finding within a heterogeneous-household model with indivisible labor supply. The model results in a lower labor responsiveness to tax changes for higher-income earners. In turn, spending financed with more progressive taxes induces a smaller crowding-out, and thus larger ...
Working Paper
Theodore Roosevelt, the Election of 1912, and the Founding of the Federal Reserve
The Federal Reserve Act was the outcome of compromises among competing economic and political interests. Numerous studies examine how the act came together but largely take the makeup of Congress and the Administration as given rather than considering the unique circumstances that led to that political distribution. This paper examines how the election of 1912 changed the makeup of Congress and increased the likelihood of central banking legislation and shaped the act. The decision of Theodore Roosevelt and other Progressives to run as third-party candidates split the Republican Party and ...