Ray Fair has updated his econometric model of the presidential popular vote outcomes with the latest GDP and inflation figures. For the first time this cycle he finds that President Obama’s percentage of the popular vote is likely to fall below 50%. With becoming focus on his model rather than the politics, essentially he says that if the popular vote isn’t very, very close, there’s something wrong with his model:
Comparing the April 27, 2012, prediction with the July 27, 2012, prediction, the lower growth rate hurt Obama and the lower inflation rate helped. On net, the predicted two-party vote share for the Democrats (VP) fell from 50.2 percent to 49.5 percent. The main message, however, is the same as it has been since October 30, 2011, namely that the election is too close to call. The ex ante standard error is around 3 percent—see Table 5 in Presidential and Congressional Vote-Share Equations: November 2010 Update—and a predicted loss for the Democrats of 0.5 percentage points is well within this standard error. If the election is in fact close, the vote equation will have done well. If one of the two candidates wins by a fairly large amount, it will not have done well.
The president’s prospects are going in the wrong direction.
