9307340 Norpoth Many people, candidates for elected office, political commentators, and academic students of elections all believe that the economy holds the key to electoral success. "It's the economy, stupid" was a slogan supposedly posted at the headquarters of a recent presidential candidate. But how does the economy exercise this electoral power? How do voters grasp the reality of something as complex as the economy? This research focuses on the economy in the future tense, the expectations of ordinary voters about the state of the economy. Do they see the economy getting better or getting worse? What makes them optimistic rather than pessimistic? One school of thought believes that they do so solely by looking back at how things have gone lately (as they see it). In other words, people extrapolate past trends into the future. But a rival school of thought claims that people are far more farsighted than that. They are capable of discerning important developments that portend future turns of events not dictated by past trends. Not being professional economists, ordinary voters may be hard pressed to divine the future in a rational fashion. But in following the coverage of economic news by the media, voters may be able to catch the key "indicators" of future performance whose workings only the experts understand. The research charts voter expectations over a time span now covering more than 30 years, going back for some items to the late 1940s. To understand how voters form economic expectations is significant not only for students of elections, but also for what it tells us about the ability of government to handle the economy. Should the electorate turn out to be naive, ignorant, and backward looking, government has considerable latitude for a policy of quick fixes. On the other hand, with a more discerning and farsighted electorate, government cannot expect to win popular favor with such policies. ***
