All (economic) politics is local: Voting responses to localized price shocks during the great recession

Abstract

The connection between individual and macroeconomic conditions and voting behavior is well-established. We contribute to the less resolved “spatial gap” in the literature that centers on how the localized economic conditions of where voters live influence their likelihood to vote. We test how space mediates the tension between voter mobilization and withdrawal in the face of economic shocks. We consider a scenario, the Great Recession, where economic shocks were quite localized and sudden, and compile an extensive dataset of all registered voters in the four-county Tampa metropolitan area between 2006 and 2015. Using sales prices and property characteristics from the tax assessor rolls, we estimate a neighborhood-level shock to housing values induced by the Great Recession. Results show that when we do not account for local neighborhood variation, the Great Recession is associated with a significant decrease in voter turnout. However, when we account for localized economic shocks, we find that residents in neighborhoods with negative price shocks were more likely to vote after the Recession, especially in non-local elections. In addition, the propensity to vote increases with the size of the negative price shock. There is some evidence that variation at the neighborhood level matters more than voter-level heterogeneity. The positive voting response is most profound in predominantly Black neighborhoods, and, to a lesser extent, in predominantly Hispanic and the lowest income neighborhoods. Increases in the propensity to vote are robust to models controlling for baseline economic vulnerabilities, such as localized unemployment, the weakness of the local housing market and exposure to sectors hit hardest by the Recession. The results indicate that dramatic and sudden changes in localized economic conditions can drive voting behavior, and in ways that are distinct from macroeconomic drivers. In addition, the housing asset channel appears to be a powerful one, which can induce significant voting responses at the national level apart from other localized economic drivers, especially among homeowners.