Group-Specific Responses to Retrospective Economic Performance: A Multilevel Analysis of Parliamentary Elections

Abstract

What is the relationship between electoral and economic performance? Previous literature posits that poor economic performance hurts the incumbent at the ballot box because overall economic performance serves as a competence signal, which voters can readily access at low costs. Building on an emerging economic voting literature exploring heterogeneity in the electorate, this article argues that social groups are affected differently by various dimensions of economic performance and that their sociotropic sanctioning of incumbents is contingent on the retrospective performance of these dimensions. It theorizes how four social groups—low-skilled workers, pensioners, public sector employees, and high-income individuals—are differently affected by each of four economic dimensions: unemployment, inflation, stock market performance, and public spending; as a result, they penalize the incumbent to varying extents. Results from a multilevel logistic regression analysis from four modules of the Comparative Study of Electoral Systems containing around seventy electoral contexts are consistent with the argument.