Endogenous economic voting: evidence from the 1997 British election

Abstract

Using panel surveys conducted in Great Britain before and after the 1997 general election, we examine the relationship between voting behavior and post-election economic perceptions. Drawing on psychological theories of attitude formation, we argue that those who voted for Labour and the Liberal Democrats perceived the past state of the British economy under the Tory government more negatively than they had prior to casting their ballot in the 1997 election. Similarly, we posit that Labour supporters would view the future state of the national economy under Labour more positively than they had before the election. This indicates that, contrary to many assumptions in the economic voting literature, voting behavior influences evaluations of the economy as voters seek to reduce inconsistencies between their vote choice and evaluations of the economy by bringing their attitudes in line with the vote they cast in the election. It also means that votersâ post-election economic perceptions are, at least in part, influenced by and thus endogenous to their vote choice. This finding has two major implications: First, cross-sectional models of economic voting are likely to overestimate the effect of economic perceptions on the vote. Second, the endogeneity of economic perceptions may compromise the quality of economic voting as a mechanism for democratic accountability.