Selfish and Prospective: Theory and Evidence of Pocketbook Voting

38 Pages Posted: 8 Dec 2008

See all articles by Mikael Elinder

Mikael Elinder

Uppsala University - Department of Economics; Research Institute of Industrial Economics (IFN)

Henrik Jordahl

Örebro University - School of Business; Research Institute of Industrial Economics (IFN); CESifo; IZA

Panu Poutvaara

University of Helsinki - Department of Economics; Helsinki Center of Economic Research (HECER); CESifo (Center for Economic Studies and Ifo Institute); IZA Institute of Labor Economics

Multiple version iconThere are 3 versions of this paper

Date Written: December 2008

Abstract

We present and test a theory of prospective and retrospective pocketbook voting. Focusing on two large reforms in Sweden, we establish a causal chain from policies to sizeable individual gains and losses and then to voting. The Social Democrats proposed budget cuts affecting parents with young children before the 1994 election, but made generous promises to the same group before the 1998 election. Since parents with older children were largely unaffected we use a difference-in-differences strategy for identification. We find clear evidence of prospective pocketbook voting. Voters respond to campaign promises but not to the later implementation of the reforms.

Keywords: elections, economic voting, pocketbook voting, self-interest, prospective voting, retrospective voting, child care

JEL Classification: C21, D72, H50

Suggested Citation

Elinder, Mikael and Jordahl, Henrik and Poutvaara, Panu, Selfish and Prospective: Theory and Evidence of Pocketbook Voting (December 2008). CESifo Working Paper Series No. 2489, Available at SSRN: https://ssrn.com/abstract=1313034 or http://dx.doi.org/10.2139/ssrn.1313034

Mikael Elinder

Uppsala University - Department of Economics ( email )

Box 513
Uppsala, 751 20
Sweden

Research Institute of Industrial Economics (IFN) ( email )

Box 55665
Grevgatan 34, 2nd floor
Stockholm, SE-102 15
Sweden

Henrik Jordahl

Örebro University - School of Business ( email )

SE-70182 Orebro, Örebro SE-701 82
Sweden

HOME PAGE: http://https://www.oru.se/personal/henrik_jordahl

Research Institute of Industrial Economics (IFN) ( email )

Box 55665
Grevgatan 34, 2nd floor
Stockholm, SE-102 15
Sweden

HOME PAGE: http://www.ifn.se/hj

CESifo ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

IZA ( email )

P.O. Box 7240
Bonn, D-53072
Germany

Panu Poutvaara (Contact Author)

University of Helsinki - Department of Economics ( email )

P.O. Box 54
FIN-00014 Helsinki
Finland

HOME PAGE: http://www.valt.helsinki.fi/blogs/poutvaar/

Helsinki Center of Economic Research (HECER) ( email )

FI-00014 Helsinki
Finland

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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