1 Stanford University, 579 Serra Mall, Stanford, CA 94305 (e-mail: ) · 2 Princeton University, Corwin 34, Princeton, NJ 08544 (e-mail: ) · 3 Chicago Booth School of Business, University of Chicago, 5087 South Woodland Avenue, Chicago, IL 60637 (e-mail: ) · 4 Stanford University, 616 Serra Street, Stanford, CA 94305 (e-mail: )
Abstract
We consider two classes of explanations for the rise in policy-related economic uncertainty in the United States since 1960. The first stresses growth in government spending, taxes, and regulation. A second stresses increased political polarization and its implications for the policymaking process and policy choices.