Forecasting Presidential Elections A Comparison of Naive Models

Forecasting Presidential Elections: A Comparison of Naive Models Author(s): Michael S. Lewis-Beck and Tom W.
Rice Source: Political Behavior, Vol. 6, No. 1 (1984), pp. 9-21 Published by: Springer Stable URL: http://www.jstor.org/stable/586044 . Accessed: 12/05/2013 19:26
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PRESIDENTIAL FORECASTING ELECTIONS: A Comparison of Naive Models

Michael S. Lewis-Beck and Tom W. Rice
Our primaryaim is to forecast, ratherthan explain, presidential election results, using time seriesdata from the post-WorldWari period.More particularly, aggregate we seek predction of the pridential winnerwel beforethe elecdonactualy occurs.Aftercomparof severalnaive blvarlatemodels based on economic performance, Ing the performance Intermational politicalexperience,and presidential popularity,we go on to Involvement, formulatea multivaratemodel. Thb economy-popularity regreslon model ratheraccurately forecasts the winner 6 months In advance of the election, by employingspring mesures of presidentdal popularityand the growthrate In real GNP per capita.Furthermore, the model'sperformance,both ex post facto and prior to the election, compares favorablywith the Gallupfinal preelection poUtakenonly a few days beforethe ekcdon.
In the scientificstudyof politics, the primary goal is usuallyexplanation. However, for the investigationof certainphenomena,such as presidential elections, the goal of predictionis obviouslyimportantas well. Politicians, citizens,journalists,and scholarsare foreveraskingthe intriguing question, Who will be the next president?These interlocutorsseek prediction,not explanation. They want an accurate forecast of the winner. Below, we endeavorto meet this need. We comparethe performance of severalpopular bivariateforecastingmodels, utilizingaggregatetime series data from the post-World War II period. From this comparison,we develop a multiple regression modelthat forecastspresidential electionresultsratherwell. Before embarkingon these analyses,we should clarifycentralaspectsof our researchstrategy.First, our emphasisis on true forecasting,i.e., predictingthe winnerbeforethe electionoccurs.Therefore,the only time series
MichaelS. Lewis-Beck, Department of PoliticalScience,University of Iowa;Tom W. Rice,
Department of Political Science, University of Vermont.
o 1984 Agathon Press, Inc.
PoliticalBehavior
Vol. 6, No. 1, 1984

9
10
AND RICE LEWIS-BECK
models that can be entertainedare those with sufficientlylagged indepenfocus, specialattention dent variables.Moreover,becauseof the forecasting is paid to goodness-of-fitmeasures,such as the R2 and predictionerror(for a good introductionto forecastingtechniques,see Pindyckand Rubinfeld, 1976, chap. 6). Second, our approachis naive. That is, we offer no sophisticatedtheoryof voting, rigorouslytestedin a statisticalmodel. Instead,we freely explore the performanceof numeroussimple measuresof popular reflect,in at least a roughway, determivariablesthat apparently aggregate nants of individualvoting behavior. This downplay of theory seems justified on severalgrounds. For one, the results from aggregatetime series data are, of necessity, compatiblewith various individualmechanismsof voterchoice. For another,the amountof informationthat can ultimatelybe gotten out of our small data set, which covers just nine presidentialelections, is quite limited. For yet another, the dominant aim is not theory building,but forecasting.Of course,whetherour researchstrategywill lead of to betterforecastsis best decided,in the end, by the actualperformance our preferredmodel. We begin by comparingthe performanceof some simplemodels.
MODELS BIVARIATE FORECASTING
Initially, four models, based on economic performance,international involvement, political experience, and presidentialpopularity, suggested themselves.Below, we explain each, evaluatingit in terms of how well it electionreturns.Specifically,we first want to prepredictsthe presidential vote won by the candiof the total popularpresidential dict the percentage date of the incumbentparty, Vt.As shall be seen, these modelsvaryin their abilityto predictthis vote share.To providea baselinefor theirassessment, considerhow well we could predictthe incumbentparty candidate'svote variablesin these models. percentage,knowingnothingof the independent Our "bestguess"would be 50.90/, the mean value of our dependentvariable, V,, measuredfor the nine presidentialelections from 1948 to 1980. How well does this averageguess perform?Not very well, as Figure la shows. A repeatedpredictionthat the incumbentparty candidatereceives 50.9% of the vote fails, of course, to account for any of the variation around that figure. Thus, the deviation of the predictedfrom the actual values is generallygreat. In fact, the largest error is - 10.4 percentage points, which occurswith the 1964 election, when Lyndon Johnson won a landslidevictorywith 61.3% of the vote. Overall,the averageabsoluteprepoints. diction erroracrossthese nine electionsis a sizable6.08 percentage Clearly,predictioncan be improvedby carefulselectionof relevantindemodels economicperformance To beginwith, we consider variables. pendent
ELECTIONS PRESIDENTIAL FORECASTING

a. Mean Incumbent as Predictor Party Vote b. Real CiP Per Capita Growth as Predictor Rate (t-6)
11
60%
60%
.50%
50%
40%
2= .00
40%
R2 .31
48
52
56
60 Year
64
68
72
76
80
48
52
56
60 Year
64
68
72
76
80
d. c. May Popularitv as Predictor
and Real GNP Per May Popularity Capita Growth Rate as Predictors
60%
60%
50%
50%
0 40% R2= 48 .72 52 56 60 Year Actual Vote --64 68 72 76
>~~~~~~~~~~"
40%
... I S _.
R2
.,~~~ .8
52 56 60 Year 64 68 72 76 80
80
48
Predicted
Vote
electionpredictions using selectedforecastingmodels. FIG. 1. Presidential
of presidentialelections, for they are the most thoroughly researched (Abrams,1980;Craineet al., 1978;Fair, 1978;Meltzerand Vellrath,1975). In brief, the theoreticalundergirding of these studies is the notion that voters punish or reward the incumbentparty, accordingto whetherthe variablesexamined economy is weak or strong. The usual macroeconomic are unemployment, inflation, income, and gross national product, in a varietyof ways. We looked at thesesamefour variables,meameasured suringthem as changes,and laggingthem at differentintervals.More precisely, we estimatedwith ordinaryleast squares(OLS) a seriesof bivariate regressionequations,wherethe dependentvariablewas alwaysincumbent variableswerechangesin the unempartyvote share, and the independent ploymentrate, the inflationrate, the real disposibleincome per capita, and the real gross national productper capita. In decidingon the appropriate lags, we wereguidedby our desireto developa model that was trulyuseful as a forecastingtool. Therefore,we sought only indicatorsthat were publicly availablefar enoughin advanceof the election.The lag periodschosen
12
LEWIS-BECK AND RICE
were from 6 to 3 monthsbefore the election, 9 to 6 monthsbefore, 12 to 6 months before, 18 to 6 months before, and the year before the electionto the electionyear. For each of these time periods,the changein each of the four economic variables was calculated, yielding a total of 20 macroeconomicindicatorsto be examined. The OLS estimatesfrom the resulting20 bivariateregressionsstrongly confirmthe economicvoting hypothesis.With but one exception,the signs helpsthe incumof the coefficientsareas expected,implyingthat prosperity bent party but hard times hurt it. Further, half the coefficients achieve statisticalsignificance(It!> 1.42, significantat .10, one-tail), despite the smallsamplesize. However,none of the coefficientsfor the unemployment indicatorsare statisticallysignificant.Moreover,the R2 of the unemployment equationsare consistentlylow. On the basis of these results,then, the variableis droppedfrom furtherconsideration. unemployment Among the remainingvariables(income, inflation, GNP), which promises betterforecasts?We cannotsimplychoosethe equationwith the highest R2 because the best-fittingequationsfrom each of the three variablesall -the values. However,two of thesebest-fittingequations yield comparable one for GNP and the one for inflation-have the samelag, i.e., the quarter from 9 to 6 months before the election, which suggeststhe preferredlag structure.Between the two, we favor using the GNP measure (i.e., the growth rate in real per capita GNP in the quarterfrom 9 to 6 months before, G,-d,for severalreasons.First, Fair's(1978, pp. 170-171)excellent paperconcludedthat the growthrate of real per capita GNP, especiallyin the second and third quartersof the election year, is the chief economic choice. Second, GNP is moreglobal than presidential variablein explaining thus indirectlycapturingsome of their variables, other macroeconomic the a realGNP measureincludesinfluencefrom the rival effects. In particular, variableof inflation. Third,the impactof this GNP indicatoris robustfor, unlike all the other economicindicatorsconsideredhere, it does not wash out when noneconomicvariablesare introducedinto the model (more on this later). Below, then, are the OLS estimatesfor this simple economic elections. model of presidential
V-=49.96+ 2.41 G, 6
(1.77) R2=.31 SE=6.58 N=9 (1)
vote receivedby of the total popularpresidential where V,= the percentage the incumbentpartycandidate;G,6 = the growthrate in real (1972= 100) GNP per capita in the quarterfrom 9 to 6 monthsbefore the election;the
PRESIDENTIAL ELECTIONS FORECASTING
13
figure in the parentheses = the t-ratio; R2 = the coefficient of determination; SE = the standard error of estimate; N= the number of observations (on presidential elections from 1948 to 1980); all economic indicators herein are calculated from Statistical Abstract of the United States, Department of Commerce, Washington, D.C., various issues; election data are taken from PresidentialElections Since 1789, Congressional Quarterly, Washington, D.C. The forecasting potential of this economic model is poor, as Figure lb demonstrates. Most of the predicted vote totals continue to fall far from the actual values. For only three elections - 1948, 1960, 1976- are the predictions at all close. The 1964 election result, the most difficult to predict according to our earlier Figure 1a, is still missed by a full 8.5 percentage points. Overall, the average absolute prediction error is an unsatisfying 5.12 percentage points. Obviously, other models demand exploration. A model that is underresearched, but receives occasional backing from the press and the public, is based on the degree of United States international involvement. A specific version of this argument is that involvement in war increases electoral support for the nation's leader and party. Fair (1978, p. 170), who tested this hypothesis by regressing presidential vote on the current size of the armed forces, turned up an insignificant coefficient. After experimenting with a lagged armed forces variable, we reached the same conclusion. Perhaps these insignificant results come from narrowly defining international involvement to include only armed conflict. Suppose we take a broader view and look at a measure that covers all kinds of international tension, regardless of whether it leads to military engagement. We developed such a measure, utilizing responses to the Gallup poll question, "What is the most important problem facing the nation today?" For each year, we constructed an index of perceived international tension, derived from the number and the rank of international problems mentioned. Then we calculated the change in the index from one year, e.g., Y1, to the next, e.g., Y2, and used this change score as a lagged predictor for the following year, e.g., Y3. Regressing this change in international tension variable, I, 12, on incumbent party vote share yields the following OLS estimates:
Vt= 49.29 + .22It (1.46) R2=.23
12
(2)
SE=6.97
N=9
where V, and the statistics are defined as with Equation 1; I, 12 = an index of perceived change in international tension during the previous year, based on the annual Gallup poll list of the top 10 problems (i.e., if an international
14
LEWIS-BECK AND RICE
problem is number 1, it is weighted 10, if number 2, it is weighted 9, etc.; the sum of these weights is calculated as a percentage of the total possible weight of the 10 items; finally, the change in this percentage from one year to the next is computed, and lagged one year); all the Gallup poll data used herein are taken from The Gallup Poll, Scholarly Resources, Wilmington, Delaware, various issues. These results, which yield a significant (at .10) coefficient for I, 12' SUpport the hypothesis that heightened international tension favors the incumbent president'sparty. Hence, the employment of this novel measure appears to improve our understanding of the forces shaping the presidential vote. However, the forecasting ability of this model is quite limited, as the low R2 suggests. Other variables, as well, need to be brought into the picture. A variable that has long been recognized as important, at least for presidential nomination, is political experience. From 1868 to 1972, for example, only four of the major party presidential nominees had no prior government experience (Peabody and Lubalin, 1975, p. 37). As DiClerico (1979, p. 8) remarked, "Not only is such experience considered by many to be a requisite for the Presidency, but also government positions are likely to provide their occupants with some degree of national recognition." Curiously, no one has empirically examined the direct influence of political experience on presidential election itself. We did so, after constructing a previous political experience variable, E,, which simply records the difference in the number of years the incumbent party candidate and the challenger have held major office. The following offices were included: president, vicepresident, senator, representative, governor. (Eisenhower's term as general was counted as 7 years). Thus, for example, Gerald Ford had 17 years of experience in 1976, whereas Carter had only 4, giving a difference score on E, of + 13. The hypothesis is that, the greater the incumbent party candidate's advantage with regard to political experience, the more votes he will receive. To test this, we regressed E, on V,, which yields the following:
Vt= 46.35 + .78Et (3)
(1.88)
R2=.34
SE=6.47
N=9
where Vtand the statistics are defined as before; E, = the difference in previous political experience between the two candidates, measured as described above; the political experience data are from Presidential Elections Since 1789, Congressional Quarterly, Washington, D.C. These results indicate that greater political experience does significantly enhance the incumbent party candidate's chance of victory. Perhaps
FORECASTING ELECTIONS PRESIDENTIAL
15
this model performsas well as the GNP model, accordingto surprisingly, the R2. However,again, the fit is too poor to permitaccurateforecasting. (A weighted version of the political experiencevariable, which counted presidentand vice-president double, was also tried. This improvedthe fit, but not enoughfor forecastingpurposes.)Fortunately,the next modelto be consideredperformsmuch better. The study of presidential popularityholds much interest.The responses to the Galluppoll question,"Do you approveor disapproveof the way X is handlinghis job as President?" have servedas the dependentvariablein a greatnumberof investigations. Until ratherrecently,presidential approval was regardedas having little to do with the vote for president(Mueller, 1973, pp. 197-202). But, more recentefforts have demonstrated that these two variablesare highly related (Sigelman, 1979; Lewis-Beckand Rice, 1982).Thus, the possibilityis raisedthat presidential popularityfigurescan generate successful forecasts for presidentialelections. In Table 1, we observe the R2 resultingwhen the incumbentparty vote variable, V,, is regressedon percentageapprovingof the president,P,, at selected lags. Clearly,the best fit (R2= .72) occurswhenpopularity is measured 6 months before the election,P, 6.
for Presidential Popularity Models at Different Monthly Lags Popularity Lag 6 Mo. 9 Mo. 12 Mo. 18 Mo. 24 Mo. 36 Mo. Variance accounted for in the popular .72 .46 .41 .49 .50 .24 vote for incumbent's party (R2)
R2
TABLE 1.
For at least two reasons, it does not appearthat this fit can really be improvedupon by utilizingpopularitypolls still closerto the election.First, thereare data availability problems,for Galluphas not regularly posedthis item during the summerand fall months of an election year. (The only exceptionis June, whose popularitydata yield a fit essentiallyequivalent to May.) Second,even if we wereto follow the strategyof employingthe latest availablepoll, regardless of what month it falls in, the R2 remainsvirtually unchanged(at .73). The fact that the 6-monthpoll predictsso well has several attractions.For one, it makes substantivesense, becausethis time of year is more stable, with the primariesendingand the conventionsnot yet begun. Thus, the short-term distortionscomingfrom these eventsare minimized (Lewis-Beckand Rice, 1982, p. 535). For another,utilizingthe May poll permitsa forecastwell in advanceof the election.For still another,this
16
ANDRICE LEWIS-BECK
6-month lag concurs with the lag of the GNP variablein our economic model. This happycoincidence,in additionto makingthingstidy, suggests that the underlyingcausal variablesare actuallybeing tapped. Here is the partycandidatevote share, V,,on Maypresiof presidential OLS regression dentialpopularity,Pt 6:
Vt= 31.2 + .38Pt-6
(4)
N= 9
(4.22)
R2=.72
SE = 4.21
where V, and the statistics are defined as before; P,6 = the percentage handlingof his job in the May Gallup poll 6 approvingof the president's monthsbefore the election. modelis a muchbetpopularity As FigureIc shows, this Maypresidential the of the vote thanthe previousmodelsexamined.Comparing ter predictor we now observeno grossoutliers. and observedvote percentages, predicted Overall,the absolutepredictionerrorhas been reducedto 3.13 percentage points. Thus, this modelhas managedto halvethe absolutepredictionerror of the meanvote, V,,in Figurela, prediction by the know-nothing produced Nevertheless,considerableerror remains, and any real forecastinghopes model, to whichwe now turn. must lie with a multivariate
MODEL FORECASTING A MULTIVARIATE
In orderto improveforecastingaccuracy,additionalvariablesshouldbe included along with popularity. However, any such multivariatemodel must be parsimoniousor the degreesof freedom will soon be exhausted. Our strategywas to combine, in turn, each of the previousvariableswith the May popularityvariable,estimatingwith OLS. Unexpectedly,only one of these many variablesmeasuringeconomic performance,international involvement,and politicalexperiencesucceededin attainingstatisticalsigvariablewas introduced. Upon reflection,the nificance,once the popularity of presireason for this seems clear. The other variablesare determinants dential popularity. Therefore, when the relationshipbetween popularity and, say, political experienceis made statisticallyindependentby controlling in a multipleregressionequation, any possibilityof a direct, separate is removed.The sole variableto survive influencefrom politicalexperience this control was our GNP variable,growthrate in real GNP per capita in the quarterending6 monthsbeforethe election,G, 6' Unlikethe othereconomic variablesinvestigated,this GNP variableappearsto capturevote decisionprocessesthat are not totally absorbedby the popularityvariable. The OLS resultsare as follows:
FORECASTING PRESIDENTIAL ELECTIONS Vt= 33.03 + *34P,_6 (4.05) R2 =.82

+
17 (5)
1.420,t6 (1.78) N=9
SE = 3.68
where the variables and statistics are defined as before. Substantively, these are interesting findings. In particular, they shed light on the role of absolute and comparative judgments in shaping the presidential vote choice. The popularity coefficient suggests that the more satisifed voters are with the president, in an absolute sense, the more likely they are to vote for his party. But, beyond that, their judgment may be tempered by a comparative evaluation of the nation's overall economic performance. For example, if GNP is declining, ostensibly satisfied voters increasingly turn their votes to the opposition candidate, who might do a better economic job. Statistically, the findings also have appeal. The R2 indicates that over four-fifths of the variance in the presidential vote is accounted for. The closeness of the fit is visually demonstrated in Figure 1d, where the predicted values track the actual. Further, the average absolute prediction error is small, at 2.48 percentage points. (The predicted, actual, and error values are given in Table 2.) This economy-popularity model, then, predicts the popular vote share for the incumbent party candidate rather well. But, is it really good enough? An affirmative answer should show, first, that popular vote share prediction is equivalent to electoral college vote share prediction. Second, it should show that the predictions are close enough to call the victor. Below, we show each, in turn. TABLE2. Presidential ElectionPredictionwith the Economy-Popularity Modela V,= 33.03+ .34(Pt1 6) + 1.42(Gt6) Actual Popular Vote Percentage for Incumbent Party Predicted Vote Percentage ( V) Predicted Winner (V,> 50%)
Prediction Error
Prediction Success
1948 49.80% - 1.40 48.40%Vo Dewey Wrong 1952 44.60 43.03 - 1.57 Eisenhower Right 1956 57.80 57.91 .11 Eisenhower Right 1960 49.90 54.28 4.38 Nixon Wrong 1964 61.30 59.90 - 1.40 Johnson Right 1968 42.90 48.14 5.24 Nixon Right 1972 60.90 56.21 -4.69 Nixon Right 1976 48.50 49.91 1.41 Carter Right 1980 42.40 40.32 - 2.08 Reagan Right a V = the percentage of the total popularpresidential vote received by the incumbent partycandiJate'Pt -= the Galluppresidential approvalratingin May of the electionyear. Gt6 = the growthratein realGNP per capitain the quarterfrom 6 to 9 monthsbefore the election.
18
AND RICE LEWIS-BECK
It is a majority of the electoral vote, not the popular vote, which assures a candidate of the presidency. Hence, for Equation 5 to be useful in forecasting, it is necessary to demonstrate that the popular vote share and the electoral vote share are very highly related. The following OLS equation does so: C=158.04+ 4.15 Vt
(9.17) R2 =.92 N=9
(6)
where Vt and the statistics are defined as before; Ct= the incumbent party electoral vote percentage. The popular vote percentage predicts the electoral vote percentage extremely well, as the nearly perfect R2 indicates. Therefore, when our economy-popularity model predicts the popular vote share, we can be confident of its translation into electoral votes. But, even granting this precise relationship, are the predictions from Equation 5 still relatively poor? Put another way, how pleased should we be with an absolute prediction error of 2.48 percentage points? A good base of comparison comes from the results of the highly regarded Gallup final preelection poll. In this survey, which takes place only a few days before the actual presidential ballot, respondents are asked for whom they will vote. For the nine elections under study, the Gallup final preelection poll had an average absolute error of 2.14 percentage points. As one can see, this error hardly differs from that of the economy-popularity model, which uses data gathered 6 months before the election. Thus, prediction error for the economy-popularity model appears low, both absolutely and relatively. Nevertheless, is it sufficiently low actually to guess the winner in each contest? Recall that it is an electoral vote majority that guarantees victory. According to Equation 6 above, an electoral vote majority is produced by a popular vote share above 50(7o, e.g., C,= -158.04 + 4.15(50.2) = 50.29%o.Therefore, if the economy-popularity model works, it should predict a popular vote above (below) 50%ofor incumbent party winners (losers). Applying this rule, the predicted winners for these nine presidential elections are listed in Table 2. The model correctly predicts seven out of the nine races. This is hard to improve upon, given that the two missed-Truman-Dewey in 1948 and Kennedy-Nixon in 1960-were so extremely close. Indeed, the Gallup final preelection poll does no better, missing the same two contests. Moreover, the combined Gallup final preelection poll absolute error for these two difficult races, 5.3 + 1.1 = 6.4, is somewhat greater than that for the economy-popularity model, 1.40 + 4.38 = 5.78. Further, in
FORECASTING PRESIDENTIAL ELECTIONS
19
general,this Galluppoll overpredicts the vote shareof the incumbent party. (Sevenout of its nine predictionshave positivesigns, as comparedto a balanced four out of nine for the economy-popularity model.) The practical implicationof this tendencyis that supporters of the incumbentpartymay overestimate their strengthif they rely exclusivelyon this survey. The favorable comparison of the economy-popularitymodel to the Gallup final preelectionpoll is, of course, potentiallymisleading,because the former has providedafter-the-factforecasts, while the latter provides before-the-factforecasts. Forecasts prior to the elections are obviously harderthanex post facto forecasts,as suggestedby the Equation5 standard error (SE), which gives an estimateof the averagepredictionerrorto the populationof presidential elections(insteadof to the sampleitself). How, then, does the economy-popularity model performbefore the fact? To find out, we successively discardedthe last electionin the time series,reestimating the model and makinga before-the-factforecastof the discardedelection. That is, we first estimatedthe model with the eight observationsfrom 1948to 1976,usingit to forecastthe 1980electionresult;then, we estimated the model with the seven observationsfrom 1948to 1972, using it to forecast the 1976electionresult;and so on backward.As far back as we could go (five elections), this economy-popularity model correctlyforecaststhe winner, i.e., when it forecast that the incumbentcandidatewould receive more (less) than 50%, that candidateactuallywent on to win (lose). Lamentably,the model cannot be used to forecastthe initial electionsin the series, becausethe degreesof freedomwould be exhausted.Hence, the earliestelection that can be forecastis 1964. Here are the model estimates (OLS) used to forecastthe outcome of this 1964 race:
Vt= 35.27 + .26P,6 + 3.430, 6 (7)
(5.65)
(3.38)
R2= .97
SE= 1.53
N=4
wherethe variablesand the statisticsare definedas before;N= the number of observations(on elections from 1948 to 1960). The equation forecasts, 6 months before the election (with P,6 =75 0o, G, 6= 1.18%o), that Johnsonwill win with 58.8%oof the popularvote. Johnson actuallyreceived61.3q7o, yieldinga predictionerrorof only 2.5 percentage points. This performanceof the model is especiallyencouraging,for two reasons.First, the numberof cases(4) is exceedingly small.Second,this 1964 election resultis more difficult to forecastthan any of the others, in the sense that it is the most deviantin the entirepost-World War II series (recallthe earlierdiscussionof Figure 1a, when we triedto predictelections withoutexogenousinformation).
20
AND RICE LEWIS-BECK
the 1984Presidential TABLE3. May PopularityRatingNeededto Win (V,> 50q70) Election,UnderDifferentEconomicGrowthAssumptions V,= 33.03+ .34(Pt-6) + 1.42(G,-6)
Growth Rate
(Gt,-6)
Popularity
(Pt,_6)
Vote Forecast
(,
42 7o 2 7o 50.150o Scenario number 1 50.03 o 0 7o 500o Scenario number 2 - 20o 50.25 7o 590o Scenario number 3 a V = the percentage partycanby the incumbent vote received of the total popularpresidential
didate. P,6
=
the Gallup presidential approval rating in May of the election year. G-6
the
growthratein realGNP per capitain the quarterfrom 6 to 9 monthsbeforethe election.
Clearly, the economy-popularity model holds promise as a forecasting tool. Let us apply it to the 1984 election. At this writing, the necessary data on May popularity and GNP do not yet exist. However, we can postulate different scenarios and project the results they would produce. With regard to the performance of the 1984 GNP variable, there are three basic possibilities: positive growth (say G,6 =2%); no growth (say G,t6= 0%); negative growth (say G,6 = -2%). (These rates are not out of the question, e.g., for Nixon in 1972, G16 = 1.66; for Carter in 1980, Gt-6 = - 3.85.) If we plug these hypothetical values into the Equation 5 model, we can estimate what Reagan's May 1984 popularity needs to be, in order to forecast a win (V,> 50%) for the Republican presidentialcandidate (Reagan?). Not surprisingly, that critical popularity figure varies considerably, depending on how the economy is performing (see Table 3). For example, as the real GNP per capita growth rate rises from - 2% to + 2%, the winning popularity rating falls from 59% to only 42%. Put another way, candidate Reagan does not have to be highly popular to win, if the economy is doing well. But, how well is the economy likely to be doing? We guess it will not be in decline (thus eliminating scenario number 3). But, to be cautious, let us assume that there is no growth either (thus adopting scenario number 2). In this circumstance, candidate Reagan can expect to win in November if his May popularity rating is 500o or more.
SUMMARY AND CONCLUSIONS
We explored leading explanations of presidential voting, hoping to arrive at a forecasting model for presidential elections. None of the bivariate models experimented with-economic performance, international involvement, political experience, presidential popularity-generated sufficiently accurate predictions. Therefore, we constructed from them a multivariate model, predicting the incumbent party vote percentage from presidential
FORECASTING PRESIDENTIAL ELECTIONS
21
popularityand the quarterly growthrate in real GNP per capita, measured 6 months before the election. This economy-popularity model performs well, evenwhencomparedto the Gallupfinal preelection poll. In particular, as an ex post facto model, it correctlyforecastsseven out of nine winners, and as a priorto the fact model,it correctly forecastsfive out of five winners. Despite this impressiverecord, one should not be overly optimistic about the model's precision. After all, it relies on the past to predictthe future, obviouslya riskybusiness.The past here is the post-WorldWar II period, which some might considermore or less "normal," with relatively minor political and economic fluctuations.Certainly,this era has experienced no Bull Moose party, GreatDepression,or worldwar. If such events were to occur, forecasts from the model might be way off. Even if the futurecontinuesto presenta rather"normal" politicaland economicenvironment, the model is bound to miss sometimesjust because particular races are so close (e.g., Kennedywon in 1960 with 50.1% of the popular vote). Nevertheless, at least in the near term, this economy-popularity model can be expected to move us far beyond guesswork, significantly increasing our chancesof foretellingwell in advancewho the next president will be.
REFERENCES Abrams,BurtonA. (1980). "TheInfluenceof State-Level EconomicConditionson Presidential Elections."Public Choice 35:623-631. Crain, W. Mark, Thomas H. Deaton, and Robert D. Tollison (1978). "Macroeconomic Determinants of the Vote in PresidentialElections."Public Finance Quarterly 6:427-438. DiClerico, Robert (1979). The American Presidency. Englewood Cliffs, N.J.: Prentice-Hall. Fair, Ray C. (1978). "The Effect of Economic Events on Votes for President." Reviewof Economicsand Statistics60:159-173. Lewis-Beck,Michael S., and Tom W. Rice (1982). "Presidential Popularityand Presidential Vote."Public OpinionQuarterly 46:534-537. Meltzer,Allan H., and MarcVellrath(1975)."TheEffects of EconomicPolicieson Votes for President: Some Evidencefrom RecentElections." Journalof Law and Economics 18:781-798. Mueller,John (1973). War,Presidents,and Public Opinion.New York: Wiley. Peabody, Robert, and Eve Lubalin (1975). "The Making of PresidentialCandidates."In CharlesDunn (ed.), TheFutureof the AmericanPresidency.Morristown, N.J.: GeneralLearningPress. Pindyck, Robert S., and Daniel L. Rubinfeld(1976). EconometricModels and EconomicForecasts.New York: McGraw-Hill. Sigelman,Lee (1979). "Presidential Popularityand Presidential Elections."Public OpinionQuarterly 43:532-534.

Forecasting Presidential Elections A Comparison of Naive Models

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Forecasting Presidential Elections: A Comparison of Naive Models Author(s): Michael S. Lewis-Beck and Tom W.

PRESIDENTIAL FORECASTING ELECTIONS: A Comparison of Naive Models

o 1984 Agathon Press, Inc.

Vol. 6, No. 1, 1984

AND RICE LEWIS-BECK

ELECTIONS PRESIDENTIAL FORECASTING

d. c. May Popularitv as Predictor

0 40% R2= 48 .72 52 56 60 Year Actual Vote --64 68 72 76

electionpredictions using selectedforecastingmodels. FIG. 1. Presidential

LEWIS-BECK AND RICE

PRESIDENTIAL ELECTIONS FORECASTING

LEWIS-BECK AND RICE

FORECASTING ELECTIONS PRESIDENTIAL

FORECASTING PRESIDENTIAL ELECTIONS Vt= 33.03 + *34P,_6 (4.05) R2 =.82

1.420,t6 (1.78) N=9

AND RICE LEWIS-BECK

FORECASTING PRESIDENTIAL ELECTIONS

AND RICE LEWIS-BECK

growthratein realGNP per capitain the quarterfrom 6 to 9 monthsbeforethe election.

FORECASTING PRESIDENTIAL ELECTIONS

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