Abstract
AbstractA robust economy is assumed to bolster leaders' standing. This ignores how benefits of growth are distributed. Extending the partisan models of economic voting, we theorize executives are more likely rewarded when gains from growth go to their constituents. Analyses of presidential approval in 18 Latin American countries support our pro-constituency model of accountability. When economic inequality is high, growth concentrates among the rich, and approval of right-of-center presidents is higher. Leftist presidents benefit from growth when gains are more equally distributed. Further analyses show growth and inequality inform perceptions of personal finances differently based on wealth, providing a micro-mechanism behind the aggregate findings. Study results imply that the economy is not purely a valence issue, but also a position issue.
Highlights
A robust economy is assumed to bolster leaders’ standing
Voters judge how closely politicians’ stances on political issues match their own. This “positional” dimension includes stances on issues related to the distribution of economic gains and policy benefits across constituencies
Whether they reward incumbents for growth should, we propose, depends on how economic gains are distributed to their main constituencies
Summary
Unlike prices and jobs, whose benefits disproportionally accrue to different constituencies, the literature traditionally treats GDP growth as a straight valence issue: all prefer more to less. The opposite should occur for rightist incumbents, whose policy stances are indifferent, if not antithetical, to income redistribution Such leaders should not expect substantial rewards for economic expansion in countries with high net income equality since the gains from growth will be widely diffused. Drawing on the partisan theory of Hibbs, Alesina, and others, this line of reasoning creates expectations for how voters respond to economic growth—an outcome purported to benefit all voters, at least in absolute terms Whether they reward incumbents for growth should, we propose, depends on how economic gains are distributed to their main constituencies. Where policies generate high net inequality, growth will disproportionately favor the well-off and, in turn, bolster support for leaders to the right of center These expectations may be conveyed more formally as: Approvall = al + blG + llI + dl(G × I) + XV + 1. Higher inequality boosts the gains from growth attributed to right-of-center presidents (δr > 0)
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