Saturday, November 13, 2010

Political Preference and the Economy

How is the economy doing? According to recent research (see this article) your answer to this question may depend on your political party preferences. Not because economic benefits are doled out to people based on how they voted. Rather, that how people judge the state of the economy can be predicted by their political preferences:
"Partisan predispositions exerted a powerful impact on perceptions of 'objective' economic events," wrote Bartels, "not only in the extreme categories of 'strong' Democrats and Republicans but over the whole range of the party identification scale."
...These aren't idle bluffs. Gerber and Huber have also shown that retail spending is strongly correlated with whether there is alignment between partisanship and who holds the presidency. Democratic-leaning counties spend more after a Democrat is elected president and less after a Republican is (and vice versa for Republicans). Nor is partisan-tinged economic evaluation unique to Americans. Researchers studying British politics in the '90s found the same phenomenon.
It would be interesting to see if economists opinions shared this bias.

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