- In one sentence, what is the major question the author is asking in this article?
In the article by R. C. Fair entitled “Econometrics and Presidential Elections”, the author states that there is a specific connection between the economic growth of the state and the person who is currently at the helm; moreover, Fair asks whether the rates of the economic growth can be calculated if considering the factors of the presidential elections, and if so, which factors precisely.
- Why is this question important / relevant?
The issue of the relationship between who the current leader of the country is and the economical position which the country is going to take in the course of several years after the election is rather important, since it allows to figure out whether a certain political leader is going to lead the country to prosperity or, on the contrary, be a complete failure. Hence, the equation which Fair offers is likely to shape the outcomes of the elections to a considerable extent.
- How does economic theory / past literature address this question?
Fair does not address major economic theories in his article, nor does he indicate the similar topics raised in the past literature; however, it can be considered that the author views the issue from the standpoint of the theory of econometrics. The author mentions the given field of economics in his work, which gives reasons to suggest that the issue in question should be viewed through the lens of the econometrics postulates.
- Write out the basic econometric equation used in this article.
According to Fair, the following equation can help figure out whether the candidate for the presidential elections is going to raise the country’s economics:
V = a1 + a2t + a3I + a4DREP + a5g*I + u
- Interpret the estimated coefficients in the model.
In the given formula, the variables should be deciphered in the following way:
V – democratic share of the vote;
t – time trend;
I – inflation rates;
DREP – the variable which equals 1 if the president is a Republican and is running the elections, and is equal 0 if any of the above-mentioned is not true;
g – growth rate per capita.
It is important to mention, though, that the given formula is not quite stable. Once a new factor is discovered, it is likely to change to offer even more precise results.
- Discuss the econometric problems the author faced in this article.
Although the formula which the author offers seems rather logical and accurate, in the course of delivering the given formula, Fair faced certain difficulties. To start with, the author made it obvious that the variables in the formula have been changing until all the factors that have impact on the results of voting have been checked. Moreover, as it has been mentioned before, new factors are likely to be discovered, which will shape the given formula once again until it is fully precise.
Another challenge that Fair faced during the research was getting the results of his research less specific; according to what the author said, the number of participants in the research was rather limited, which could have made the research results not as objective as they should be. However, it is necessary to add that at present, it seems that Fair has encompassed every single factor that affects the voters’ behavior.