Does market volatility impact presidential approval?
Version of Record online: 25 JUL 2011
Copyright © 2011 John Wiley & Sons, Ltd.
Journal of Public Affairs
Special Issue: Aspects of Public Affairs in a Changing Continent: African Perspectives
Volume 11, Issue 4, pages 387–394, November 2011
How to Cite
Chong, J., Halcoussis, D. and Phillips, M. (2011), Does market volatility impact presidential approval?. J. Publ. Aff., 11: 387–394. doi: 10.1002/pa.410
- Issue online: 24 NOV 2011
- Version of Record online: 25 JUL 2011
- Manuscript Accepted: 19 JUN 2011
- Manuscript Received: 10 APR 2011
- Political economy;
- Presidential approval;
Recently, market volatility has been used as an explanatory variable for presidential job approval. Our research builds on such an approach by first extracting the economic and non-economic components of market volatility using the Eta® (c4cast.com, Inc., 750 E. Walnut St., Pasadena, CA 91101) model, which considers 18 economic factors, far more than the unemployment and inflation factors used in most similar studies. Further, our results suggest that it is not aggregated market volatility but rather disaggregated market volatility that has a causal effect on presidential job approval ratings. In addition, the market's expectation of economic and non-economic market volatility exhibits different patterns, in terms of direction and timing, in their relationship to presidential job approval ratings. Copyright © 2011 John Wiley & Sons, Ltd.