01751cas a2200253 a 4500 AALejournalIMF004572 230101c9999 xx r poo 0 0eng d 5.00 USD 9781451865202 1018-5941 BD-DhAAL BD-DhAAL Paiva, Claudio. Political Price Cycles in Regulated Industries : Theory and Evidence / Claudio Paiva, Rodrigo Moita. Washington, D.C. : International Monetary Fund, 2006. 1 online resource (22 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students This paper develops a model of political regulation in which politicians set the regulated price in order to maximize electoral support by signaling to voters a pro-consumer behavior. Political incentives and welfare constraints interact in the model, yielding an equilibrium in which the real price in a regulated industry may fall in periods immediately preceding an election. The paper also provides empirical support for the theoretical model. Using quarterly data from 32 industrial and developing countries over 1978-2004, we find strong statistical and econometric evidence pointing toward the existence of electoral price cycles in gasoline markets. Mode of access: Internet Moita, Rodrigo. IMF Working Papers; Working Paper ; No. 2006/260 Full text available on IMF http://elibrary.imf.org/view/journals/001/2006/260/001.2006.issue-260-en.xml IMF e-Library