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“Taking Occam’s Razor to the Endogeneity Problem in Economic Voting”


  • Davis, Brent


Conventional economic voting models are increasingly being challenged by the problem of endogeneity – that is, causality may not run, as they suggest, in one direction from economics to politics. Rather, causality may run in the other direction, from politics to economics, or be bi-directional. While a small, but growing, number of studies are highlighting the endogeneity problem in economic voting models, there is a tendency to identify and then attempt to manage, rather than eliminate, the distortions caused by endogeneity in economic voting models. At least worst, economic voting models which do not deal with endogeneity are vulnerable to producing biased results; at worst, the results may be spurious. Rather than just attempting to manage the endogeneity problem in, this study proposes a strategy to purge it from, economic voting models. However, in doing so, it further brings into question the fulcrum idea of economic voting models, finding instead ‘politics drives economics’ rather than the other way around.

Suggested Citation

  • Davis, Brent, 2017. "“Taking Occam’s Razor to the Endogeneity Problem in Economic Voting”," MPRA Paper 80732, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:80732

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    References listed on IDEAS

    1. Nannestad, Peter & Paldam, Martin, 1994. "The VP-Function: A Survey of the Literature on Vote and Popularity Functions after 25 Years," Public Choice, Springer, vol. 79(3-4), pages 213-245, June.
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    4. Hansford, Thomas G. & Gomez, Brad T., 2010. "Estimating the Electoral Effects of Voter Turnout," American Political Science Review, Cambridge University Press, vol. 104(2), pages 268-288, May.
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    More about this item


    politimetric modelling; economic voting; voter behaviour; endogeneity; structural equation modelling;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • C54 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Quantitative Policy Modeling
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

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