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Consumer Confidence and Elections

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Author Info

  • Dimitrios D. Thomakos

    ()
    (University of Peloponnese, Greece and The Rimini Centre for Economics Analysis, Italy.)

  • Gikas A. Hardouvelis

    ()
    (University of Piraeus, Greece and CEPR)

Abstract

We investigate the behavior of consumer confidence around national elections in the EU-15 countries during 1985:1-2007:3. Consumer confidence increases before the date of elections and falls subsequently by almost the same amount. It is able to predict the strength of the performance of the incumbent party and its probability of re-election both alone and in the presence of macroeconomic and fiscal variables. The post-election drop is negatively related to the previous run up and is a function of the political - but not the economic - environment. A similar rise and fall characterizes consumer confidence in the United States.

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Bibliographic Info

Paper provided by The Rimini Centre for Economic Analysis in its series Working Paper Series with number 42-07.

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Date of creation: Jul 2007
Date of revision: Jul 2007
Handle: RePEc:rim:rimwps:42-07

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Keywords: consumer confidence; national elections; incumbent party; macro-economy; fiscal conditions; political business cycle; EU-15; USA.;

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Cited by:
  1. Dudek, Sławomir, 2008. "Consumer Survey Data and short-term forecasting of households consumption expenditures in Poland," MPRA Paper 19818, University Library of Munich, Germany.
  2. Bahram Adrangi & Joseph Macri, 2011. "Consumer Confidence and Aggregate Consumption Expenditures in the United States," Review of Economics & Finance, Better Advances Press, Canada, vol. 1, pages 1-18, February.

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