Voters back incumbents who back their economic interests

It has generally been accepted that economic competence is a core  concern of all voters. But new research, published recently in Politics and Society, shows this is not always the case.

Study author, Dr Tim Vlandas, of Oxford’s Department of Social Policy and Intervention, maintains, voters are far more complex – and likely to vote for incumbents, depending on how economic performance affect them specifically, rather than based on a general evaluation of the economy.

The study broadens the scope of economic voting research by investigating how the electoral impact of the economy varies by social group in terms of how particular dimensions of economic performance affects them, not just in terms of general competence.

High unemployment, price rises or austerity do not necessarily spell political disaster...Conversely, greater public spending and low unemployment may not automatically translate into popularity

Dr Vlandas argues voters react in distinct ways to different aspects of economic performance, as they affect them personally to varying degrees. As a result, high unemployment, price rises or austerity do not necessarily spell political disaster if certain groups of politically powerful voters are not directly affected. Conversely, greater public spending and low unemployment may not automatically translate into popularity. Thus, voters penalise incumbent politicians to varying extents, depending on their personal exposure to specific dimensions of economic deterioration.

Dr Vlandas says, ‘Prevailing wisdom suggests that poor economic performance has a negative effect on the re-election chances of political incumbents, either because it signals a lack of competence or because it has an effect on voters’ lives.

‘However, this expectation is subject to conflicting results...In this paper, we build on the emerging idea of heterogeneity among electorates which challenges the assumption that all voters can be thought of as penalising incompetence in a similar way.’

According to the paper, ‘Different social  groups have different risk profiles and distinct economic and welfare state policy preferences, which have important implications for electoral behaviour...[for instance] the  expected  electoral  response  to  austerity  policies  is  heavily  contingent  on  individuals’  socioeconomic  resources to withstand cutbacks in government programs.’

Margaret Thatcher’s relatively poor economic performance in terms of unemployment did not prevent her from getting re-elected multiple times, according to the study.  

The paper points to one UK politician who was re-elected despite [or, perhaps, because of] economic misery, ‘Margaret Thatcher’s relatively poor economic performance in terms of unemployment did not prevent her from getting re-elected multiple times.’

However, her continuing success, according to the paper ‘could have been the result of economic policies that primarily hurt the low-skilled and the poor, while potentially benefiting some high-income voters and the elderly’.

The article maintains it is the individual’s experience, rather than the politician’s perceived competence, which is key, ‘The  electoral  impact  of  deteriorating  economic  performance  is  largely  contingent  on  individuals’  risk  profiles,  with  pensioners appearing particularly responsive to retrospective inflation performance, low-skilled  workers  to  unemployment  levels,  public  sector  workers  and  low-skilled  workers  to  public  sector  cuts,  and  high-income  individuals  to  developments  in  the  stock market.’

Dr Vlandas adds, ‘Public spending primarily affects the probability of voting for incumbents both among public sector and low-skilled workers, while it influences the electoral decisions of pensioners and high-income earners considerably less so or not at all.’

Public spending primarily affects the probability of voting for incumbents among public sector and low-skilled workers, while it influences...pensioners and high-income earners considerably less so or not at all

Dr Tim Vlandas

But, he says, ‘The opposite pattern emerges with variation in stock market performance: high-income earners and pensioners are highly responsive to stock market returns, whereas public sector and low-income workers are largely unaffected by them.’

The research found incumbent politicians can be affected, ‘Voters are more likely to turn their back on incumbents when certain aspects of the economy deteriorate that are of particular importance for the social groups to which they belong.’

Dr Vlandas says, ‘With pre-electoral unemployment rates...propensity to vote for incumbents declines somewhat more rapidly among the ranks of low-skilled workers,... [But] The group-specific response to inflation marks a clear divide between pensioners and the rest of the population, with the former systematically penalising incumbents during inflationary electoral contexts.’

The findings, say the authors, empirically demonstrate the heterogeneity of social groups in their economic voting patterns, strengthening the electoral link between group-specific policy preferences and government policies.

The paper provides a novel explanation for why there is so little evidence on systematic electoral punishment against governments that undertake policies, such as fiscal adjustment and austerity, that are detrimental for growth (at least in the short run): it is only a subset of the population that is responsive to economic outcomes that are conventionally presumed to capture the economic vote, with other variables being equally important pieces of the full economic voting picture.

The study looked at four social groups (low-skilled workers, pensioners, public sector employees and high-income individuals) and four economic variables (unemployment, inflation, stock market performance and public spending).

Co-written with Dr Abel Bojar from the European University Institute, the paper can be seen here: https://journals.sagepub.com/doi/10.1177/0032329221989150.