Benchmarking or Spillovers: The Economic Vote Before and During the Great Recession

During the Great Recession many incumbent parties were not confirmed in power by the ballots. The harsh law of the economic vote severely undermined their electoral chances. Yet it is unclear if they were punished by the absolute poor state of affairs, or by the relative deterioration of the economy; by a direct judgement of the domestic situation, or by its comparison with some external benchmark capturing more global dynamics; and whether or not the global crisis modified all these parameters. This exploratory analysis looks into all these issues using a dataset covering all the elections that took place in 38 democracies in the period 2000-2015, and contributing to the recent debate about the actual benchmarking of the state of the economy from behalf of voters. The Great Recession confirms its exceptional character, revealing that absolute reference points became more important than tailored benchmarks and short-term comparisons.