Perceptions Of Economic Conditions Research Articles

The Role of Economic Conditions in Shaping Citizens' Satisfaction with Government in Tunisia's Fragile Democracy: An Expectancy-Disconfirmation Analysis

ABSTRACT The idea that citizens are satisfied with the government as long as its performance exceeds expectations has been extensively used to explain satisfaction with governments in well-established democracies. Less attention has been paid to the role of expectations in determining citizens' satisfaction in fragile states, although dissatisfaction with government has been theorized as a cause of upheaval. Likewise, less attention is paid to the role of citizens' perception of economic conditions in determining satisfaction with government. This study tests the role of expectations of improving economic conditions in explaining low satisfaction with the government in Tunisia, which embarked on a fragile transition to democracy in 2011. Findings suggest that citizens' evaluation of Tunisia's economic performance could explain the lack of satisfaction with the government after the uprising of 2011.

Structural Predictors of Underemployment During COVID-19 Pandemic: A Psychology of Working Perspective

In the present study, we surveyed a sample of working adults ( N = 495) in the United States to understand experiences with underemployment during the COVID-19 pandemic. Drawing from psychology of working theory, we examined a structural model linking economic constraints and experiences of marginalization to underemployment, as mediated by work volition and moderated by perceptions of economic conditions. Economic constraints, experiences of marginalization, and work volition all significantly predicted underemployment, accounting for 52% of the variance. Additionally, work volition served as a significant, but minor, mediator variable and economic conditions were a significant moderator linking economic constraints and experiences of marginalization to work volition. The negative effect of these constructs on work volition was mitigated when participants had more favorable perceptions of the economy at large. Findings may have implications for both research and practice, highlighting the importance of assessing structural and psychological factors to understand individuals’ work experiences.

Uncertainty and disagreement of inflation expectations: Evidence from household‐level qualitative survey responses

AbstractWe propose a procedure that jointly estimates expectation, uncertainty, and disagreement using a flexible hierarchical ordered response model and individual‐level qualitative data. Based on the Michigan survey of US consumers, our results reveal how their inflation expectations and the associated uncertainty are affected by various factors, including their perceptions of economic conditions, recollections of relevant news reports, and sociodemographic characteristics. An examination of the dynamics of inflation uncertainty and disagreement produces evidence in support of using the latter as a proxy of the former. However, our results also highlight important episodes (such as the start of the COVID pandemic) in which the two series diverge.

Requiem for a Dream: Perceived Economic Conditions and Subjective Well-Being in Times of Prosperity and Economic Crisis.

Using the Panel of Social Inequalities in Catalonia, Spain (PaD 2001–2012), this article investigates the relationship between perceptions of economic conditions and subjective well-being in times of prosperity and economic crisis. It also analyses how this relationship plays out across different social backgrounds. Periods of economic crisis and prosperity serve as a proxy for objective macroeconomic conditions. The Spanish region of Catalonia is a relevant setting because it faced one of the highest increases in inequality and unemployment in Europe as a result of the 2008 Economic Crisis. Our results show that perceived economic conditions matter beyond objective micro and macroeconomic realm and become a strong determinant of subjective well-being during a crisis, particularly for the middle class. However, contrary to our initial expectations, our results also show the existence of a close correlation between perceptions of economic conditions and subjective well-being for low social background individuals in times of economic prosperity, and an even stronger relationship in times of economic crisis. The article stipulates several potential explanations for these results.

Contextualizing the Economic Basis of Political Support: Government Economic Engagement, Economic Perceptions, and Democratic Satisfaction

Research has shown that citizens’ economic perceptions heavily influence their political support, both support for the incumbent government and support for the political system. Yet, inadequate attention has been paid to how the economic roles of the government shape the economic basis of political support. We argue that the extent to which the government is engaged in the economy determines how people attribute economic success or failure to the government and thus moderates the effect of economic perceptions. Focusing on one widely researched measurement of political support in a democratic setting, democratic satisfaction, we analyze the moderating effect of government economic engagement on the effect of economic perceptions among eighteen Latin American democracies. A consistent finding yielded in our study is that with a higher level of economic engagement of the government, there is a stronger association between citizens’ perceptions of economic conditions and their satisfaction with democracy.

Budgeting by Priorities: Balancing Stability with Economic Responsiveness

This article investigates how the budget priorities of Arkansas state government departments vary with changes in economic conditions. the Arkansas Revenue Stabilization Act (ARSA) of 1945 established a formalized method of state budgeting by priorities. State funds are allocated, meaning the funds are legally made available, according to priority levels established each year by the Governor and the General Assembly. Those allocated funds are later distributed, meaning released for spending, according to priority levels as funds become available. in this study, we ask the research question: Are departmental budget priorities driven by stability or are they responsive to economic condition? Incrementalism suggests that incremental annual changes in the budget are based on the previous year's budget, they take place across-the-board, and that there lacks an in depth consideration of priorities. However, ARSA requires explicit prioritization within each department. Perceptions of economic conditions are likely to play into this prioritization. We hypothesize that the higher priority items will follow a more incremental pattern of mostly being based on the previous year's budget in favor of stability. We also hypothesize that the economy has a greater impact on the lower priority items in favor of economic responsiveness. Our findings suggest that incrementalism is a persistent influence across priority levels. However, there is rational consideration during an economic downturn that results in a decline in funding for lower priority budget items.

Electoral reform, situational forces, and political confidence: Results from a multi-wave panel

Political confidence scores have been attributed to two sources: one structural, the other situational. To reverse a loss in political confidence, New Zealand chose a structural remedy and changed its electoral system to include the election of Members of Parliament on the basis of proportional representation. This paper examines the impact of electoral reform on confidence by tracking a panel of individuals surveyed before, during, and after the implementation of proportional representation. We employ a hybrid-effects model to explore the importance of electoral system change and find that both structural reform and situational factors orthogonally shaped political confidence. Interaction terms indicate that the influence of electoral reform is moderated by considerations of party control of government, ideological commitment, and perceptions of economic conditions. Opinion change over time is much more evident at the aggregate than at the individual level.

Factors Influencing Consumption Patterns of Household Recognizing Relatively Deprivation

This study identifies the relation between recognition relatively deprivation and consumption patterns. The data used were the seventh Korea Welfare Panel Study (KOWEPS). The final sample of 1,597 households was selected based on several sampling steps standard weights suggested by KOWEPS were applied. The final sample was subdivided into household recognizing relatively deprivation (51.7%) and non-household recognizing relatively deprivation (48.3%) per level of subjective income and objective income. We derived six consumption patterns from the cluster analysis as per consumption ratio: transportation dominant consumption pattern, essential consumption pattern, other dominant consumption pattern, care attention consumption pattern, private transfer consumption pattern, and education dominant consumption pattern. The results of this study are as follows. The analysis of the determinants of recognizing relatively deprivation in regards to question one found that the household was likely to be relatively deprived when: the head of a household was older, a household had a dual income, children and more total assets then those assessed 1 year ago compared to household living conditions, result of comparing the consumption patterns difference between household recognizing relatively deprivation and non-household recognizing relatively deprivation indicated that household recognizing relatively deprivation was more likely to belong to the transportation dominant consumption pattern, other dominant consumption pattern, and private transfer consumption pattern. The multinomial logistic analysis conducted to understand the determinants affecting the consumption patterns of household recognizing relatively deprivation indicated differences in demographic characteristics, household-related variables, financial variables and perception of economic conditions. Keywords: subjective income level, objective income level, household recognizing relatively deprivation, consumption pattern

Reassessing the Effect of Economic Conditions on Support for Democracy: Evidence from the 2009 - 2013 Romanian Election Study Panel

Placed within the framework of Easton's model of support for the political system, we analyze the relationship between individual perceptions of economic conditions and different dimensions of support for democracy (from specific, to middle-range, and to diffuse support). While this is an often-researched topic, we believe that the current economic crisis, one of the most important in several decades, requires a new look at the effects of economic crises on support for democracy. Using panel data covering the period from November 2009 to January 2013 we are able to focus our analysis on identifying the effects of the global economic crisis on support for democracy in Romania, a fragile and still unconsolidated democracy both at the institutional and at the individual level. By estimating a series of fixed effects regression models we are able to show that both the economic crisis and evaluations of the economic performance in the past (retrospective sociotropic) do have significant effects on those components of support for democracy that combine elements of diffuse and specific support, but not on the most diffuse forms of support. According to our results, while the economic crisis did have some negative effects on middle-range forms of support for democracy, diffuse support for democracy was least affected by the current economic crisis in Romania.

From the Horse's Mouth: Economic Conditions and Investor Expectations of Risk and Return

Data obtained from monthly Gallup/UBS surveys from 1998 to 2007 and from a special supplement to the Michigan Surveys of Consumer Attitudes and Behavior, run in 22 monthly surveys between 2000 and 2005, are used to analyze stock market beliefs and portfolio choices of household investors. We show that the key variables found to be positive predictors of actual stock returns in the asset-pricing literature are also highly correlated with investor's subjective expected returns, but with the opposite sign. Moreover, our analysis of the microdata indicates that subjective expectations of both risk and returns on stocks are strongly influenced by perceptions of economic conditions. In particular, when investors believe macroeconomic conditions are more expansionary, they tend to expect both higher returns and lower volatility. This is difficult to reconcile with the canonical view that expected returns on stocks rise during recessions to compensate household investors for increased exposure or sensitivity to macroeconomic risks. Finally, the relevance of these investors' subjective expectations is supported by the finding of a significant link between their expectations and portfolio choices. In particular, we show that portfolio equity positions tend to be higher for those respondents that anticipate higher expected returns or lower uncertainty.This paper was accepted by Brad Barber, finance.

Capital Flight in the Presence of Domestic Borrowing: Evidence from Eastern European Economies

Summary We estimate capital flight from 10 Central and Eastern European countries for the period 1996–2009. Capital flight from the transition economies is mainly an economic phenomenon, driven by differences in interest rates and investors’ perceptions of economic conditions in their countries as well as by the ease with which they are able to obtain funds that can be transferred overseas through domestic loans and capital inflows. Domestic credit expansion is an important source of financing for capital flight. Paradoxically, financial liberalization has fueled rather than reduced capital flight by reducing its costs and increasing the funds that can be moved abroad.

How to Make Governments More Responsive in Africa?

In this paper, I analyze the relationship between satisfaction with democracy, trust in President, perception of corruption, economic conditions and perceptions of government performance in improving living standard of the poor. Using afrobarometer data, I find out that from one country to another, there is a gap between supply and demand regarding positive perception of government performance in improving poor living condition. However, results indicate that satisfaction with democracy, reduction of corruption and best economic reforms can improve the approval of government performance in living standard for the poor. Finally, by using the propensity score method, I demonstrate that positive perception of economic condition has a positive effect on perception of improving living standard of the poor. These results suggest that in African countries, policy agenda should focus on economic reforms to reach their responsiveness in improving living standard for the poor.

From the Horse's Mouth: How Do Investor Expectations of Risk and Return Vary with Economic Conditions?

Data obtained from monthly Gallup/UBS surveys from 1998-2007 and from a special supplement to the Michigan Surveys of Consumer Attitudes, run in 22 monthly surveys between 2000-2005, are used to analyze stock market beliefs and portfolio choices of household investors. We show that the key variables found to be positive predictors of actual stock returns in the asset-pricing literature are also highly correlated with investor’s reported expected returns, but with the opposite sign. Moreover, analysis of the micro data indicates that expectations of both risk and returns on stocks are strongly influenced by perceptions of economic conditions. In particular, when investors believe macroeconomic conditions are more expansionary, they tend to expect both higher returns and lower volatility. This is difficult to reconcile with the canonical view that expected returns on stocks rise during recessions to compensate household investors for increased exposure or sensitivity to macroeconomic risks. Finally, the relevance of these investors’ reported expectations is supported by the finding of a significant link between their expectations and portfolio choices. In particular, we show that portfolio equity positions tend to be higher for those respondents that anticipate higher expected returns or lower uncertainty.

Local economies and national economic evaluations

Underlying the phenomena of economic voting are voters’ perceptions of economic conditions. But from where do these evaluations originate? This work examines the effects of three types of factors influential to the formation of national economic evaluations: predispositions (such as age, gender, income, partisanship), information and attentiveness, and objective local economic conditions (local unemployment rates). Our findings fit with earlier work, broadly confirming the influential role each set of factors plays in shaping national economic perceptions. We then extend the literature - demonstrating that the impact of the local economic environment is conditional on attention to media, political information and education. Using a combined dataset of the 2006 Canadian Election Studies with neighbourhood level economic indicators drawn from Canadian Census data (2006), our findings show that, in developing perceptions of the national economy, more attentive, more informed and more educated individuals are less influenced by local economic conditions than their less attentive, less informed and less educated counterparts. These findings contribute to our understanding of how local economic conditions influence the formation of national economic evaluations.

Regulatory Focus and Political Decision Making: When People Favor Reform Over the Status Quo

Two studies examined the impact of self-reported use of promotion-related (i.e., eagerness) and prevention-related (i.e., vigilance) strategies when making or conservative decisions about economic reform under good, average, or poor economic conditions. Consistent with regulatory focus theory (Higgins, 1997, 1998, 2000), in both studies strategic vigilance was associated with making a conservative choice, whereas strategic eagerness was associated with making a risky choice. In addition, along with perceptions of economic conditions , chronic strength of prevention focus (Study 1) or situationally induced prevention focus (Study 2) was associated with using strategic vigilance, whereas chronic strength of promotion focus (Study 1) or situationally induced promotion focus (Study 2) was associated with using strategic eagerness. Finally, regulatory focus and economic perceptions indirectly predicted economic reform decisions through their impact on strategy use. Our studies are the first to demonstrate that vigilant or eager strategy use is associated with conservative or political decisions.

Popular Satisfaction with the Party System and Representative Democracy in the United States

There are a variety of explanations for diminished levels of popular support for American government, institutions, and leaders evident since the Watergate era. Prominent theories focus on the changing nature of US political culture or perceptions of economic conditions. A plausible alternative explanation is that citizens feel inadequately represented by agents of government, and that the linkages facilitating representation no longer function effectively. Although the role of political parties often is portrayed as declining, parties still have the potential to be meaningful conduits for citizen representation. The article examines explanations for public support or alienation from various dimensions of the political system, focusing on citizens' orientations toward political parties. In general, it finds a strong connection between citizens' partisanship and feelings about political parties and their support for the political regime and democratic processes.

Public Trust in the New Parliaments of Central and Eastern Europe

After the collapse of the Soviet empire, democratic parliamentary elections were conducted in the countries of Central and Eastern Europe, and new parliaments convened, in the early 1990s. How much confidence did citizens in these new democracies have in their new parliament? Under what conditions is citizens' trust in parliament meagre or ample? Public opinion surveys conduced in 1990–1 in nine countries – Bulgaria, Czechoslovakia, Estonia, Hungary, Lithuania, Poland, Romania, Slovenia, and Ukraine – provide data for analysing citizens', trusting or distrusting orientations. Parliamentary trust is significantly influenced by perceptions of economic conditions, and by confidence in politicians and government generally but, surprisingly, not much affected by political awareness or involvement levels, political efficacy, or social class differentials. These findings indicate that public confidence in these parliaments will grow with economic prosperity and the demonstrated effectiveness of the government to govern.

Soviet perceptions of economic conditions during the period of stagnation: Evidence from two diverse emigrant surveys

Soviet reality and emigrant surveys THE SOVIET INTERVIEW PROJECT (SIP) interviewed 2793 former Soviet citizens in the early 1980s who had emigrated to the United States from the mid-1970s to the early 1980s. A second wave of 700 interviews was conducted in the mid-1980s. SIP respondents were from medium to large cities from European republics and hence represent a sample of urban, European residents. Some 86% of SIP respondents were Jewish according to some definition of the term.1 SIP respondents answered questions on their life in the Soviet Union (in the last normal period of life in the Soviet Union) prior to the disruptions caused by the decision to emigrate. The German Soviet Interview Project (GSIP) interviewed 516 former Soviet citizens who had emigrated to the Federal Republic between 1979 and 1983. GSIP respondents also answered questions about their last period of normal life in the Soviet Union prior to the emigration decision. GSIP respondents are of German background who qualified as 'late emigrants' (Spataussiedler) according to Soviet and German definitions. GSIP respondents were from both urban and rural areas, and the majority lived outside the European USSR. The two sets of interviews with former Soviet citizens shed perspective light on living conditions in the Soviet Union. Both surveys focus on life in the Soviet Union and not on the processes of emigration or assimilation. Although the SIP and GSIP surveys were conducted roughly five years apart, modal respondents in both surveys cite 1977-78 as their last period of normal life in the Soviet Union. Hence, the interviews describe life in the Soviet Union as the Brezhnev era was drawing to a close-the period now referred to in the Soviet press as the 'period of stagnation' (period zastoya). The late Brezhnev era provides the essential baseline for understanding the perestroika phenomenon. Presumably, the Soviet leadership had its own perceptions of economic conditions during this period and was becoming increasingly influenced by public concerns about deteriorating economic conditions. Evaluating economic performance during the period of stagnation continues to be difficult because biased performance indicators continued to be generated by the statistical