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Aggregate earnings and market expectations in United States presidential election prediction markets

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  • Wiesen, Taylor

Abstract

This study uses election futures market data to provide the first empirical evidence that aggregate earnings conveys timely “election-relevant” information effecting betting market participants' expectations about the likely outcomes of United States presidential election campaigns. I document that aggregate earnings news is associated with multiple facets of U.S. economic health affecting voter utility. I then use high-frequency data from the Iowa Electronic Political Prediction Market (IEM) to document that aggregate earnings news, including cash flow news, is significantly related to changes in the expected outcomes of U.S. presidential elections and incremental of other measures of economic health.

Suggested Citation

  • Wiesen, Taylor, 2023. "Aggregate earnings and market expectations in United States presidential election prediction markets," Advances in accounting, Elsevier, vol. 60(C).
    • Handle: RePEc:eee:advacc:v:60:y:2023:i:c:s088261102200058x
    DOI: 10.1016/j.adiac.2022.100639
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    More about this item

    Keywords

    Aggregate earnings; Expected earnings; Decision relevance; United States presidential elections; Political prediction markets;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting

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