Panel Paper:
Party Performance: Does the Political Party in Power Affect Policy Outcomes?
Thursday, November 3, 2016
:
2:15 PM
Oak Lawn (Washington Hilton)
*Names in bold indicate Presenter
Scholars have long argued that the political party in power matters for policy outcomes like the performance on the economy. But, does the party in power truly have a causal impact on policy outcomes? In this paper, we use a unique dataset that tracks the party composition of state legislatures over time and uses a regression discontinuity design (RDD) to test whether Republican of Democratic state legislatures promote better economic, schooling, crime, and health outcomes. We find that legislatures controlled by Democrats promote immediate and long-run gains in student achievement. The evidence suggests that much this difference can be attributed to fundamentally different approaches to taxation and spending; with marginal Republican legislatures being much less likely to raise and spend money on the education system than those controlled by Democrats. Despite this important difference, the party in control has no causal impact on health, crime, nor the performance of the economy--suggesting that previous observational studies may have overstated the role of the political party in power.
