The Political (and Economic) Origins of Consumer Confidence


  • Suzanna De Boef,

  • Paul M. Kellstedt

  • We thank Bob Erikson, Jim Stimson, and participants in the seminars in American Politics at Columbia University, Texas A&M University, Michigan State University, the University of North Carolina, Chapel Hill, and the Political Psychology and Behavior Workshop at Harvard University for helpful comments on earlier versions of this research.

Suzanna De Boef is Associate Professor of Political Science, Pennsylvania State University, 219 Pond Laboratory, University Park, PA 16802-6200 ( Paul M. Kellstedt is Assistant Professor of Political Science, Texas A&M University, 4348 TAMU, College Station, TX 77843-4348 (


Economic conditions, the story usually goes, influence consumer confidence, which in turn influences both political evaluations and votes. But we have little sense of the origins of consumer confidence itself. It is generally assumed that monthly reports of the nation's level of consumer confidence respond to objective economic conditions. We argue that politics is important for understanding consumer sentiment beyond what we know from economic conditions. Specifically, we demonstrate a direct effect of political evaluations of the president's management of the economy, the party of the president, extraordinary political events, and monetary policy, as well as an indirect effect of media coverage of the economy, on consumer sentiment, after controlling for economic conditions. When news coverage is positive, citizens give favorable evaluations, leading to more positive sentiment. Our findings suggest that understanding the political economy requires an emphasis on the causal effect of politics as well as economics.