Michael referred me to this Blog Entry, at Statistical Modeling, Causal Inference, and Social Science, that deals with the choices of US political parties. It links the idea of what the optimal behavior in business cycles should be to what the optimal behavior in electoral cycles should be.
The blogger argues that it is in the best interest of a party to run new members when elections are expected to be in their party's favor and to run incumbents when elections will not be in their party's favor (since incumbency advantage will help). However, he points out that neither Democratic nor the Republican parties follow this strategy- in fact, they do the exact opposite. They run newcomers in risky elections and incumbents in safe ones.
If you assume that parties have no contol over electoral cycles, then the blogger is right. Parties should be running incumbents in years where the party is unpopular and new comers in years where the party is popular. However, if parties can control electoral swings by trying to remain popular as long as possible then I think parties should run incumbents when the party is popular and new comers when it is unpopular. Why?
When the party is popular: (1) Incumbents know how Washington works, they know how to get things done. They will make changes, and this will make the Party popular in the electorate. (2) If the party runs new people during popular periods, not only are they getting rid of the people that actually made the party popular, they are relying on people who will just be learning how the legislative process works. These individuals are bound to make mistakes and this could harm the Party's image. Remember the 1994 Congressional election?
When the party is unpopular: The incumbents may be the ones contributing to the unpoplarity of the party. Keeping them around is not going to improve the image of the party. Bringing in new members may improve the party's image. Right now I think many Republican incumbents are associated with the Bush years, and by staying in office, they continue to taint the party with Bush's legacy.
In sum, by keeping incumbents around when the party is popular in the electorate, the party continues to be popular and will continues to win office. If they run newcomers during this time period, they are at risk of cutting their popularity streak short. Further, by ousting incumbents during unpopular years, the party is getting rid of the people who tainted the party's image and introducing new members who can improve the image and electoral popularity of the party.
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