Situational Gamblers: Prospect Theory and the Commonalities of Presidential Campaign Management

Abstract

In this article, prospect theory helps shed light on an underdeveloped topic in political science: the management strategies of presidential campaigns. In particular, prospect theory is used to understand critical decisions made by the campaigns of Edward Kennedy, Jimmy Carter, Ronald Reagan, and George H. W. Bush during three critical junctures of the 1980 presidential primary season. Prospect theory's central finding—that individuals are risk averse when facing gains and risk acceptant when facing losses—provides a systematic and empirically grounded explanation for seemingly puzzling decisions made by each campaign. In a broad sense, this essay begins the process of developing a general perspective on presidential campaign management.