Equilibrium communication in political scandals

We present a formal model in which elite communication and voters’ beliefs during a political scandal emerge as a communication equilibrium, determined by the severity of the accusations and the degree of media scrutiny. The prediction of our model is that incumbents’ use of denials can garner support even when they face the possibility of evidence showing their guilt. In contrast, public apologies increase approval – compared to denial – only when accusations are not very serious and are likely to be proved. Results from a large survey experiment corroborate these predictions. In order to explore how changes in the information environment shapes the communication equilibrium, we estimate the structural parameters of our model and conduct counterfactual simulations. We find that increasing media scrutiny leads to asymmetric effects on incumbent communication with politicians who are the best at covering up evidence actually benefiting from increased scrutiny.