All's Fair in Politics
By Michael Munger
Economist Ray Fair’s very simple model on presidential elections has some interesting things to say about the upcoming election. Given the macro-economic and macro-political factors that have mattered in the past, George W. Bush should win between 57% and 58% of the popular vote, according to the model. Any way that this happens implies a large Electoral College victory for Bush.
Here is the main estimation equation:
VOTE = 55.57 + .691*GROWTH – .775*INFLATION + .837*GOODNEWS
You can simulate results by playing with your own assumed values here.
A note on the past: Fair’s model predicted that Gore would win the 2000 election; and since “win” is defined in terms of popular vote, he was right! The prediction was that the Dem candidate takes 50.8% of the two party vote. The actual number received by Gore was 50.3%; pretty impressive.