The U.S. economy has grown far more rapidly under Democratic presidents than under Republican presidents since World War II -- but why?
A paper released Tuesday by the National Bureau of Economic Research seeks to answer that question.
The analysis arrived at a timely moment, given Wednesday's report that the American economy grew at a rate of 4.0 percent between April and June this year, beating forecasts and putting a pep in the step of Democratic officeholders.
But before Democrats begin cutting triumphant campaign ads, they should consider another of the paper's findings: while the GDP has seen greater increases under Democrats than Republicans, that fact appears to have little to do with the specific policies enacted under each president.
"The U.S. economy not only grows faster, according to real GDP and other measures, during Democratic versus Republican presidencies, it also produces more jobs, lowers the unemployment rate, generates higher corporate profits and investment, and turns in higher stock market returns," wrote Princeton economists Alan Blinder and Mark Watson. "Indeed, it outperforms under almost all standard macroeconomic metrics."
It's a startling piece of top-line analysis, but a closer look reveals a far more complicated picture.
"By some measures, the partisan performance gap is startlingly large," the authors write. "So large, in fact, that it strains credulity, given how little influence over the economy most economists (or the Constitution, for that matter) assign to the President of the United States."
Blinder and Watson determine that partisan differences in neither fiscal policy nor defense policy can explain the variation in economic growth. In fact, the parties were not all that far apart on both counts - both Democrats and Republicans presided over similar magnitudes of tax cuts, spending increases, and defense buildups, and to similar effect. So the argument that Democrats have grown the economy by increasing government spending more quickly than Republicans doesn't hold water.
The authors point, instead, to two factors that have favored Democrats over Republicans: First, rising energy prices, and the negative effects on the economy that result, have tended to occur during GOP administrations. Republicans like Richard Nixon, Gerald Ford, and George W. Bush, for example, governed during a time of increasing oil prices.
The second factor, according to the authors, is that new technological advances that grow the economy have tended to happen during Democratic administrations. The authors cite the information revolution and the dawn of the Internet that juiced the American economy during the 1990s under Democratic President Bill Clinton.
"Democrats would no doubt like to attribute the large D-R growth gap to macroeconomic policy choices, but the data do not support such a claim," the authors write. "It seems we must look instead to several variables that are mostly 'good luck,' with perhaps a touch of 'good policy.'"
In other words, the healthier performance of the economy under Democrats than Republicans may provide a useful line in a stump speech for Democratic presidential candidates -- but it seems to have more to do with the fortune of timing than anything else.