Loss aversion, presidential responsibility, and midterm congressional elections

Abstract

I explore a behavioral model of political participation, first introduced by Quattrone, G., Tversky, A. [1988. Contrasting rational and psychological analyses of political choice. American Political Science Review 82 (3), 719–736.], based on the primitives of prospect theory, as defined by Kahneman, D., Tversky, A. [1979. Prospect theory: an analysis of decision under risk. Econometrica 47, 263–291.]. The model offers an alternative explanation for why the President's party tends to lose seats in midterm congressional elections. The model is examined empirically and compared against competing explanations for the “midterm phenomenon”.