Abstract
This literature review investigates the effects of public opinion on political outcomes in democracies, focusing on Comparative Political Economy (CPE) research. Many CPE researchers expect that parties and governments respond to public policy preferences that are exogenous to the political process. This review first formalizes the common CPE argument and then derives an alternative theoretical perspective from political psychology and political communication research. The contrasting theory highlights the impreciseness and endogeneity of public opinion, wherein political elites actively shape public sentiment. Through a comparative analysis of these contrasting theoretical approaches, the review extracts insights that promise to enrich future CPE research. It also develops the fundamentals of a theory on the impact of public opinion on political outcomes, which suggests that public opinion can be seen as an “elastic corridor” that constrains the opportunity space of parties.
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