Abstract: Governments press central banks for lower interest rates on the premise that easy money wins elections. We test this premise for 385 elections in 18 countries, 1900–2020, using exogenous interest rate changes. We find no evidence that monetary easing helps incumbents. At the point estimate, a typical easing leaves the incumbent’s vote share unchanged; the one-sided 95 percent confidence bound on the gain is 0.90 percentage points. Of 104 incumbent defeats, such an easing would have reversed none at the point estimate and 15 at the bound, all in close races. Easy money offers incumbents no reliable electoral return.

Abstract: We document that fiscal multipliers in the euro area are largely resilient to population aging, in contrast to evidence from the U.S. The reason is that aging only erodes fiscal multipliers where fiscal shocks pass through strongly to the incomes of younger, credit-constrained households -- a transmission that generous unemployment insurance systems in the euro area largely mute. Consistent with this mechanism, euro area regions with low unemployment benefits do exhibit an aging-related erosion of fiscal multipliers, reminiscent of the U.S. A New Keynesian model extended to incorporate age-heterogeneity quantitatively matches the empirical estimates of aging's effect on fiscal multipliers across both unemployment insurance regimes under standard parameterizations.