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Biased Forecasts to Affect Voting Decisions?: The Brexit Case
Uppsala University, Disciplinary Domain of Humanities and Social Sciences, Faculty of Social Sciences, Department of Economics, Uppsala Center for Fiscal Studies.
Uppsala University, Disciplinary Domain of Humanities and Social Sciences, Faculty of Social Sciences, Department of Economics. Sveriges Riksbank.
2019 (English)Report (Other academic)
Abstract [en]

This paper introduces macroeconomic forecasters as political agents and suggests that they use their forecasts to infkuence voting outcomes. We develop a probabilistic voting modelin which voters do not have complete information about the future states of the economy and have to rely on macroeconomic forecasters. The model predicts that it is optimal for forecasters with economic interest (stakes) and influence to publish biased forecasts prior to a referendum. We test our theory using high-frequency data at the forecaster level surrounding the Brexit referendum. The results show that forecasters with stakes and in uence released much more pessimistic estimates for GDP growth in the following year than other forecasters. Actual GDP growth rate in 2017 shows that forecasters with stakes and in uence were also more incorrect than other institutions and the propaganda bias explains up to 50 percent of their forecast error.

Place, publisher, year, edition, pages
Uppsala University, 2019. , p. 45
Series
Working paper / Department of Economics, Uppsala University (Online), ISSN 1653-6975 ; 2019:4
Keywords [en]
Brexit, Interest Groups, Forecasters Behavior, Voting
National Category
Economics
Research subject
Economics
Identifiers
URN: urn:nbn:se:uu:diva-379226OAI: oai:DiVA.org:uu-379226DiVA, id: diva2:1296155
Available from: 2019-03-14 Created: 2019-03-14 Last updated: 2019-03-14Bibliographically approved

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Cipullo, DavideReslow, André

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CiteExportLink to record
Permanent link

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Cite
Citation style
  • apa
  • ieee
  • modern-language-association
  • vancouver
  • Other style
More styles
Language
  • de-DE
  • en-GB
  • en-US
  • fi-FI
  • nn-NO
  • nn-NB
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  • Other locale
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Output format
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