12.0 PP 134 169 International Conditions and Popular Support in Latin America

6
International Conditions and Popular Support

in Latin America
We have learned in the previous chapters that presidents’ fates in

South America are largely determined by international conditions
they cannot influence, much less control. Fluctuations in commod-
ity prices and international interest rates that are summarized in the
GET index affect the probability of regular transitions from office. In
democratic times, they influence the likelihood of reelection, incum-
bent vote share, and even the size of vote swings between elections.
While these causal effects are strong and very consistent in the sam-
ple studied, the fact that presidential elections and termination of
governments are relatively low-frequency events make them unsuit-
able for more refined studies of the political impact of exogenous
conditions. In this chapter, thus, we examine decades-long series of
monthly presidential popularity for several Latin American countries,
and show that popular support of presidents is also highly influenced
by fluctuations in the GET index. Leaders that rule during a favorable
international scenario are far more popular than those presiding over
bad times.
6.1 T H E ‘ P R O S ’ A N D ‘ C O N S ’ O F P O P U L A R I T Y S E R I E S
Compared with electoral results, presidential popularity offers many
advantages to the study of the political impact of exogenous shocks.
Popularity series are relatively high-frequency data and have the addi-
tional advantage of not being influenced by supply-side factors such as
candidate selection and elite-level political strategizing. Yet there are also
135
https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

136 International Conditions and Popular Support
disadvantages, which suggest that any comparative analysis of popularity

data has to be taken with a grain of salt.
First, popularity is only measured through surveys, which implies
that it reflects stated as opposed to revealed voter preferences. More-
over, surveys are carried out by different companies, employing different
methodologies, and often with a variety of different purposes and agen-
das. Although nationally representative surveys have become much more
common as of late in almost all countries, it is sometimes difficult to find
and obtain data from past surveys, even when they exist. Still, we were
able to assemble a set of observations of popularity that span at least two
decades for Argentina, Brazil, Chile, Colombia, Ecuador, Peru, Uruguay,
and Venezuela. In the following sections, we describe the data in a greater
detail.
Another drawback of studies of the impact of economic performance
on popularity is potential endogeneity. Unpopular governments very
often attempt emergency short-term measures to boost support (such as
José Sarney’s price-freeze in Brazil) or, as elections approach, presidents
may be tempted to implement looser fiscal policies (as did Dilma Rousseff
or Cristina Fernández prior to their reelections) or maintain unsustain-
able exchange-rate policies (like Fernando Henrique Cardoso on the eve
of the 1998 election, or Carlos Menem toward the end of his second
term). Even though such varieties of populist measures hardly ever suc-
ceed in the long term, short-term deviations could be extremely politically
consequential. This problem also applies to the analysis of the impact of
economic conditions on elections.
Yet as we argued in the previous chapter with respect to elections, the
strength of our research design derives from the fact that the GET index is
completely exogenous to presidents’ decisions or popular support. While
we defined our explanatory variable on substantive grounds – we are
indeed interested in sources of economic performance that are not con-
trolled for presidents – the fact that it is exogenous to our outcomes of
interest greatly simplifies our analysis. Put simply, be it in the study of
elections, or now in the study of popularity series, we have a research
design that allows us to make causal inferences.
We begin this analysis by reassessing the relationship between GET
and economic performance. While we have already examined this rela-
tionship earlier in this book, we now do it in the context of the time series
that we will subsequently analyze. We proceed, next, to describe our data
on the popularity of Latin American presidents and then present some

6.2 Revisiting Exogenous Conditions & Economic Performance 137
technical details of how we will analyze it. The analysis itself involves
three steps. We first define a very minimal ‘common model’ to estimate
the impact of GET on presidential popularity, which we apply to the
available data to obtain average estimates of the effect of GET on pop-
ularity across our eight cases. We then conduct a country-by-country
analysis that allows us to make very minor additions to this common
model, and sumarize the results showing that the impact of GET on
popularity is as we expect in seven out of our eight cases.
Very interestingly, Chile emerges as a partial exception that, we
believe, proves the rule. Whereas on average GET has a negative effect
on the popularity of presidents, we find that prior to the adoption of
a countercyclical fiscal law designed to cushion the domestic economy
from exogenous fluctuations, this association was, as in other cases, pos-
itive. We conclude by discussing the implications of our results for the
prospects of democratic representation in the region.
6.2 R E V I S I T I N G E X O G E N O U S C O N D I T I O N S
AND ECONOMIC PERFORMANCE
In Chapter 4, we showed that our measure of exogenous economic con-

ditions predicted several indicators of domestic economic performance in
a subset of Latin American countries. That analysis, however, was based
on yearly data and for a wider sample than the one we consider in this
chapter. For this reason, prior to our main analyses, it is prudent to check
whether GET is, in fact, a strong predictor of economic performance for
our sample of eight countries.
To this end, we collected quarterly economic data for the same eight
countries and periods for which we have popularity data, creating an
unbalanced panel encompassing between 94–131 quarterly observations
in each country, and examined the impact of GET on GDP growth,
unemployment, (log of) inflation, and the already-mentioned Okun eco-
nomic discomfort index that combines the previous indicators. We work
with quarterly data because it is the frequency in which most economic
variables are available.
In all of the alternative specifications we estimated, the effect of GET
is strong, statistically significant, and in the expected direction. Figure
6.1 shows the cumulative effect of a one-time one-unit change in GET
on each of the outcomes of interest, estimated through fixed effects panel

FIGURE 6.1 Unit reponse of economic outcomes to GET

Figure shows the effects of one unit change in GET at t0 on different economic outcomes.
Effects are estimated on a panel of eight countries. Inflation is the only measured on a log
scale. See text for details.
regressions, and using our preferred specification that includes the lag of
dependent variable and the contemporaneous level of the GET index.1
In the case of growth, a unit change in GET in quarter t0 converges
after six quarts to an effect of increasing growth in just under one per-
centage point (growth is measured in the left-hand axis). As expected,
GET’s association with unemployment and inflation is strong and nega-
tive, as of course is the association with the discomfort index, which is the
most likely mediator of how economic conditions are felt by individuals
on the ground.
These results show that economic performance is indeed strongly
affected by variation in the GET index in the eight countries that
we analyze in this chapter. As GET varies, so do domestic economic
indicators.
1 The reasons for this being our preferred model are discussed in detail later in the chapter.

6.3 The Popularity of Latin American Presidents 139
Our theory is that citizens feel the variation in the domestic economy
and form affective judgments that subsequently influence their evaluation
of presidents’ performance. If this is the correct story, the effect of GET
on the economy, which we just showed, implies that GET also should
have a positive effect on popularity. In contrast, if individuals evaluate
presidents strictly on their contribution to economic outcomes, then we
should not see any association between GET and presidential popularity.
In the rest of this chapter, we assess the hypotheses that are true.
6.3 T H E P O P U L A R I T Y O F L A T I N A M E R I C A N
PRESIDENTS
We use the term ‘popularity’ rather loosely to capture the extent to which
a president receives a positive popular evaluation in public opinion sur-
veys. We assembled hundreds of such observations from eight LSCE
countries of South America, namely Argentina, Brazil, Chile, Colombia,
Ecuador, Peru, Uruguay, and Venezuela. In all of these countries, our data
begin in the first half of the 1990s or earlier. This means that we have
data extending to well before the commodity supercycle of the 2000s.2
These observations were collected over the years from multiple sources;
in some cases, pollsters shared long data series with us, upon request. In
others, we obtained sets of observations from websites and/or reports.
We also obtained some raw data from the Executive Approval Project
(Carlin et al. 2016), from secondary academic sources (e.g. Pérez Liñán
2013), journalists (e.g. Rodrigues 2018) and, in some cases, we obtained
additional information from news reports in the local media.3
Popularity is generally operationalized as the share of survey respon-
dents that rate the president’s performance as good or excellent. The
question wording, however, varies considerably over time and across
polling companies and is often posed in terms whether respondents
‘approve’ of the way the present has been performing his or her job.
In order to deal with this heterogeneity and following recent work on
comparative popularity of Latin American presidents (Carlin, Love and
Martínez-Gallardo 2015), we combined the raw data using the ‘dyad
2 We also obtained some data for Bolivia, but most of it refers to the Morales presidencies
and none of it comes for the period preceding the commodity supercycle. For this reason,
we do not include it in the analysis. Paraguay, as seen in the previous chapter, does not
fall into the LSCE category.
3 The complete dataset of raw observations is available in this book’s data repository.

ratios algorithm’ (WCALC) to smoothen the series, imputed missing val-

ues, and harmonized monthly observations of latent popularity for both
countries (Stimson 1998).4 WCALC is built on the assumption that the
raw survey observations are different measures of the same latent quan-
tity that we are interested in, which is popularity. Even if different surveys
use different questions or have different sampling designs, the idea is that
they are all noisy measures of this true latent popularity; what matters
here is that each available series be homogenous. By smoothening the
series, WCALC reduces the overall variation in the data. Hence, it is
worth noting that this means all the results that we find were stronger
using linearly interpolated averaged series (LIA) than using WCALC,
but we make sure to report the more conservative results. More impor-
tantly, the substantive results we report should be evaluated taking into
consideration that total variance in the data is smaller than what one
would see if examining raw popularity figures, which makes them even
more substantively relevant. Therefore, every time we mention popular-
ity, we are really talking about the dyad ratios algorithm smoothing of
raw popularity figures or ‘latent popularity.’
Table 6.1 presents a brief summary of the popularity data used in
this chapter. The first column refers to the total number of unique data
points we obtained for each country. Each data point consists of at least
one value that corresponds to the share of respondents approving of or
positively rating the performance of a president, the date of the survey,
the pollster, the type of question asked, and our source (which might or
not be the pollster itself). More often than not, data points also included
the share of respondent rating the president negatively, the sample size,
the type of sample, and surveying method (e.g. face to face, phone, or
Internet).
We then report the total number of pollsters from whom we obtained
data as well as the length (in months) of the resulting time series. The
imputed column refers to the number of months within the series for
which we do not have raw observations. This implies that the popularity
value for these months was imputed/interpolated by WCALC.
Another preliminary point worth noting is that, in one case, we did not
use all the available data listed in Table 6.1 when conducting the com-
bined analysis of our eight cases. In particular, in our initial approach,
we limit the analysis of Venezuela to the pre-2012 period, as the country
4 Specifically, we used the extract() function, which is an implementation of WCALC

for R. See the appendix 6A to this chapter for more details.

6.3 The Popularity of Latin American Presidents 141
TA B L E 6.1 Periods under consideration by country
Calendar months
Raw Obs Pollsters Total Imputed First Last

Argentina 508 4 392 72 1984–10 2017–05
Brazil 501 7 374 92 1985–03 2016–04
Chile 313 6 329 133 1990–06 2017–10
Colombia 193 3 285 141 1994–02 2017–10
Ecuador 1097 5 346 24 1988–08 2017–05
Peru 673 4 440 46 1981–04 2017–11
Uruguay 406 5 375 111 1986–08 2017–10
Venezuela 300 5 356 161 1988–02 2017–09∗
∗When estimating the common model, we only analyze data for Venezuela up through
2012–10, the period when the country could still be considered a democracy. We analyze
the full series in the Venezuela-specific discussion later.
later arguably ceased to qualify as a democracy. We return to this con-

sideration in the country-by-country analyses that follow later in the
chapter, when we explore the inclusion of Venezuela data for the 2012–
2017 period. In Figure 6.2, we report our very first approach to the data.
It shows simple averages of the popularity of presidents for the eight
South American countries for which we have data. We start the figure in
1988 because prior to this year, we only have data for four countries. In
broad strokes, presidents’ popularity was lowest in the late 1980s and
early 1990s, was at middling levels through the 1990s, dipped briefly at
the end of the decade before increasing considerably. It remained at very
high levels around 2010, and then plummeted at the end of the period.
The resemblance to the trajectory of the GET index is striking, and in the
rest of this chapter, we present evidence that this relation is not spurious.
Our data span seventy different presidencies (fifty-one presidents), in
eight countries from 1981 through 2017. The linear correlation coef-
ficient between average popularity in the term and average value of
GET in this pooled dataset is 0.28 (p-value< 0.01). If we drop Dilma
Rousseff’s second term in office, which is the clearest outlier, the correla-
tion observed in the remaining sixty-nine observations increases to 0.35
(p-value< 0.01).5 The data suggest that, on an average, when GET is one
unit higher (recall that GET is measured in a standardized scale, therefore
5 Rousseff’s popularity in her second term was much lower than what would be expected
based on GET.

FIGURE 6.2 Average popularity of presidents (1988–2017; 5–8 countries)

Figure reports averages within year and across country of presidential popularity in our
sample of eight countries. Data are not available for all countries at the start of the period.
one unit is equivalent to one standard deviation), the latent popularity

of Latin American presidents is 5.4 percentage points higher, which is
equivalent to 0.4 standard deviations of popularity in our dataset.
If instead of aggregating the data by presidency, we examine the
association between GET and popularity in our monthly dataset, and
arrive at the results reported in Table 6.2. One unit change in the GET
index is positively associated with higher values of popularity in six
of our eight countries. This association is extremely strong in Ecuador,
Brazil, and Uruguay, and less so in Argentina and Venezuela. The two
non-conforming cases, in this table, are Peru (no statistical association
between GET and popularity) and Chile, for which the association is
negative. Of course, this is an extremely naive analysis, which relies on
simply regressing popularity on the GET index, but as we see, this pattern
is also revealed by the more sophisticated analyses that follow. As we will
also show, the Peruvian case partially conforms to our expectation once

6.4 Analyzing the Popularity Time Series 143
TA B L E 6.2 Simple association between GET and

popularity, by country
Estimate Pr(>|t|) R2
Argentina 3.91 <0.01 0.26

Brazil 9.48 <0.01 0.30
Chile −4.97 <0.01 0.40
Colombia 5.18 <0.01 0.12
Ecuador 15.65 <0.01 0.50
Peru 0.07 0.92 0.10
Uruguay 7.82 <0.01 0.54
Venezuela 3.38 <0.01 0.15
Estimates reported in the table are for a simple linear regression of
popularity on GET, both of which are observed monthly.
we account for shifts in levels of popularity during the non-democratic

period of Alberto Fujimori’s presidency. The Chilean case is the exception
that strengthens our argument; as we will show, it conforms to our expec-
tations once we take into consideration the country’s countercyclical
fiscal rules.
6.4 A N A LY Z I N G T H E P O P U L A R I T Y T I M E S E R I E S
All the analyses that follow estimate the effect of the GET index on the
popularity of presidents by employing time series regressions. Popularity
is the dependent variable; our key independent variable is, unless other-
wise noted, the GET index – operationalized exactly as in Chapter 4 –
and we work with time series of monthly observations.
In our basic empirical setup, we only employ control variables to
capture the ‘popularity cycle.’ Simple inspection of the popularity series
reveals that values tend to be higher not only right after inauguration,
but also at the end of the term, though this final bump is less pronounced
than at the start. This regularity has also recently been documented more
broadly by Carlin et al. (2018).
Presidential terms across our eight countries, however, unlike regu-
lar time series seasons, are extremely irregular, making it impossible to
account for seasonality with a single time function as is typically done
with more regular series. This irregularity stems not only from differ-
ent constitutional term lengths and term limits across countries, but

also from unanticipated interruptions in presidential terms.6 In order to

control for this cycle in the most flexible way possible, we created binary
indicators indicators for honeymoon and lame-duck periods.
We defined electoral honeymoon as observations carried out four
months or less after the inauguration. In practice, this meant that the
actual number of observations of honeymoon varies a little by president,
as in some cases up to five calendar month observations might fit the defi-
nition. Also by definition, only presidents that were elected have electoral
honeymoons, and if presidents were reelected to immediately consecutive
subsequent term, we deemed there was no such honeymoon. We defined
the lame-duck dummy much in the same way, as observations taken in
the last regular four months of a presidency. This was only coded in cases
in which presidents finished their constitutional time in office, irrespective
of whether they were originally elected or not.
Relatedly, we also employ a third variable that captures a wider cycle
of sorts. The first democratically elected presidents following countries’
transition to democracy typically enjoy a transition popularity bonus,
derived from shepherding the democratization process. Navia 2009,
(p. 118) for instance, wrote that President Patrício Aylwin in Chile ‘was
helped by the enthusiasm with the successful start of the democratic
stage,’ but that ‘his popularity began to falter once the reality of the
transition sunk in.’ Similarly, in the case of Argentina, according to
Ranis (1992, p. 54), ‘Alfonsín’s honeymoon was the longest granted any
administration since Perón’s in 1946 [. . . ] Alfonsín’s democratic consen-
sus paralleled somewhat the support given to West German Chancellor
Konrad Adenauer after the Nazi horror.’
We operationalized this democratic transition period as a four-year
window following the election of the first democratic president after a
military dictatorship. In order to capture the idea that enthusiasm with
the transition fades over time, we defined it as a monthly counter vari-
able that starts at forty-eight and declines to zero at the end of the four
years. Our data extend into this window in four of our cases: Argentina
(Alfonsín), Chile (Aylwin), Peru (Belaúnde), and Uruguay (Sanguinetti).
Although we do have popularity data from within a four-year window
following the end of the dictatorship in Brazil too, president José Sar-
ney was not directly elected. In fact, he was not even indirectly elected
to the presidency, but rather, had been Tancredo Neves’ running mate
in the indirect election that marked the end of the Brazilian military
6 Colombia is the only country in our sample for which all presidential terms had the same
length.

dictatorship. Sarney initially took office as interim president following

Neves’ falling ill the night before the inauguration, and, anticlimactically
became president after Neves passed away. Therefore, he did not benefit
from any popularity bonus.
MOTIVATING OUR DYNAMIC MODEL : In order to determine the most

appropriate time series model with which to examine our data, we
employed a mix of theoretical and empirical criteria. Following Box-
Steffensmeier et al. (2014), our underlying theoretical model can be
expressed as a system of difference equations in which popularity at
any given time is a constant function of previous popularity and of eco-
nomic conditions in the previous time period and of a random shock.
Economic conditions, in our setup, are solely a function of conditions in
the previous period and a random shock.
The exogeneity of our variables allows us to make the strong assump-
tion that GET is not a function of popularity or any of its past values
of the popularity. This releases us from adopting structural equation and
vector autoregressive approaches. However, even though economic con-
ditions must be prior, in this context, we do not know a priori what the
exact lag structure might be.
One way to approach these questions would be to make some strong
assumptions about this relationship. These assumptions could lead us,
for instance, to adopt the lagged dependent variable (DV) model, which
is the workhorse model in time series regression tradition. The lagged DV
model is not without merits. Theoretically, it makes sense to consider
that popularity in any given time is a function of popularity in an ear-
lier time plus some new information (Keele and Kelly 2006). Empirically,
the inclusion of lag dependent variables almost always produces white
noise residuals, allowing for estimation through OLS. Another impor-
tant point, which is often overlooked, is that the lag DV model allows
for examination of social dynamics and long-run effects of the indepen-
dent variable on the outcome (de Boef and Keele 2008; Box-Steffensmeier
et al. 2014).
One possible downside of the lag DV model is that it imposes a very
particular lag structure in the data. While we are comfortable with the
exogeneity assumption laid out previously, we are less comfortable with
imposing any particular lag structure. Theory suggests that past values of
popularity and past values of economic conditions affect current popular-
ity, but this is simply not well defined enough to determine us how long
these effects last or whether it is mainly levels or changes in economic
conditions that produce the effects on popularity.

Another important consideration is that popularity and the GET index

seem to covary in the long run, even if movements in any given time
period are not necessarily correlated. This suggests that for each value
of GET, there exists an equilibrium level of popularity, but it also means
that we only expect an equilibrium popularity level ‘net of’ the exogenous
economic conditions. Changes in GET, in this sense, should disrupt levels
of popularity, but not vice-versa. Therefore, if there is a one-time change
in the levels of GET, popularity should move, but adjust to new levels
after some time. Political shocks, other than changes in GET, might also
affect levels of popularity, but cannot lead to changes in GET.
The autoregressive distributed lag (ADL) model is ideal for this type of
theoretical relationship between two variables, and it allows us to exam-
ine both short-term effects of the independent variable and also how
these effects propagate and compound over time. ADL models are equiv-
alent to error correction models (ECM) and are ideally suited to examine
the long-term equilibrium relationship between variables, and also how
covarying process revert back to equilibrium.7 Moreover, in addition to
being theoretically justified in the case in hand, both ADL and ECM
models also allow us to explore the social dynamics very explicitly. This
latter point means that, in using these models, we focus less on point-
estimates of the coefficients, and more on the values to which popularity
converges, and how long it takes for convergence to happen after changes
in our exogenous independent variables. These quantities of interest are
estimated through unit- and impulse-response functions.8
ADL models allow for flexible parametrizations of the lag structure
and can typically be estimated by OLS (Davidson and MacKinnon 1993;
de Boef and Keele 2008). More specifically, generic ADL models include
lags of the dependent variable as well as contemporaneous values of the
independent variable and its lags. If, for instance, we set the number o
lags of the dependent variable to one and include only contemporane-
ous measures of the independent variable, we have an ADL(1,0) model,
which happens to be the the commonly used lag DV model.
EMPIRICAL MODEL SEARCH : Our theoretical expectations are simply

not well defined enough to inform us a priori how quickly popularity
responds to GET, or how long the effects of shocks to GET take to
7 Although originally developed for cointegration, these models are applicable to dynamic
processes with or without cointegration (De Boef and Keele 2008).
8 The equivalence of ADL and ECMs mean that they generate identical estimates of unit-
and impulse-response functions.

dissipate. For this reason, we rely on empirical criteria to choose the

appropriate lag structure within a set of reasonable ADL models. We fol-
low de Boef and Keele’s (2008) suggestion to begin with a fairly generic
model, and gradually impose restrictions.
For each country we began with an ADL(2,2) model – a model with
two lags of popularity and two of GET – and estimated progressively
more restricted combinations down to the ADL(1,0) or lag DV model
in which only popularity is lagged, and only for one period. This means
that different models could be chosen for each country, but, as we dis-
cuss below, the eight cases converged to just two specifications.9 This is
a satisfactory route to us because empirically, after ‘filtering’ popularity
with our exogenous independent variables through the chosen ADL spec-
ifications, we are left with what are clearly white noise residuals. Also,
the fact that ADL models are equivalent to ECMs enables us to capture
‘joint dynamic of multiple non-stationary series’ (Box-Steffensmeier et al.
2014, p. 150)
More specifically, we began with the model selection procedure with
the following ADL model with two lags of the dependent variable and
two of the independent variables, which we refer to as ADL(2,2):
Pt = α0 + α1 Pt−1 + α2 Pt−2 + β0 GETt + β1 GETt−1 + β2 GETt−2 + γ Xt t ,

(6.1)
in which P are current and lagged values of popularity, GET are current
and lagged values of the GET index, and Xt indicates the vector of vari-
ables that capture honeymoon, lame-duck, and transition to democracy
periods. These controls, as previously discussed, absorb cycles akin to
seasonal effects.
We then work our way to the simplest, most restricted model that
generates white noise residuals. We did this by picking the model with
the lowest Bayesian information criteria (BIC) among those for which the
F-test failed to reject the null that higher order lags were different than
zero, and whose residual passed several diagnostic tests for stationarity
and autocorrelation. The result of this model search indicated that we
should fit an ADL(2,0) model to the data from four countries (Argentina,
Brazil, Ecuador, and Peru), and an ADL(1,0) – or lag-DV model – to the
other four (Chile, Colombia, Uruguay, and Venezuela).10
9 See (de Boef and Keele 2008, p. 187) for a complete description of the different models
that result from different restrictions to the generic ADL model.
10 The model choice would be the same for all countries if we used GET’s constituent parts
in the analysis (i.e. commodity price index and US interest rates) instead of the combined
GET index.

PRESENTING THE RESULTS : Instead of reporting tables of coefficients,

we focus on the substantive impact of GET and other variables of interest
on popularity. These substantive effects are computed by ‘unit response
functions.’ Unit response functions are necessary because our time-series
models capture social dynamics that feedback through the lag structure
in the data, so tables of coefficients are not very useful or informative.
The unit response functions that we report are all based on an a one-
time hypothetical change in GET of one unit, happening at t0 . As the
GET index is measured in a standardized scale, one unit of GET also cor-
responds to one standard deviation of GET. We then simply compute how
this shock propagates into changes in popularity over the subsequent
time periods. The immediate effect of GET on popularity is captured by
the coefficient on the contemporaneous observation of GET, while the
effect on the subsequent periods depend on lags of the GET index (if
included) and lags of the dependent variable. Provided our assumptions
about the long-term equilibrium between GET and popularity are cor-
rect, the effects of such changes in GET should dissipate after a certain
time and popularity should stabilize at new levels.
The fact that the best model varies across countries also poses some
difficulty for our introductory analysis, which pools data from all coun-
tries into a panel to estimate the average effect of GET on popularity
across all cases. For this reason, we report results from each of the two
different specifications that cover the whole range of variation in optimal
model specifications across countries the eight countries (i.e. ADL(2,0)
and ADL(1,0), as explained earlier). We take comfort from the fact that
these different models yield, as we show in the next section, results that
are all but substantively identical.
6.5 D O E X O G E N O U S C O N D I T I O N S A F F E C T
PRESIDENTIAL POPULARITY?
A first way to look at the data consists of estimating the selected ADL
models on the unbalanced panel created by stacking monthly popular-
ity observations from our eight countries. In order to do this, we must
estimate the same lag structure for the whole sample, so we report results
for both the ADL(2,0) and the ADL(1,0) that fit our eight cases. We fit
three variations of each of these specifications of the the common model,
namely a pooled version, one with country-fixed effects, and another
with president-fixed effects.

6.5 Do Exogenous Conditions Affect Presidential Popularity? 149
Each of these variants implies a different conception of the long-

term equilibrium between popularity and GET. In the pooled version, we
assume that there is an equilibrium popularity level for a given GET level
that is common to all countries in our sample across the entire timeframe.
The president fixed-effects specification, in contrast, assumes that there is
(or there might be) a different equilibrium level for each president. While
this is probably the cleanest model from a statistical perspective, presi-
dents are presidents govern facing very different average levels of GET
and, as such, at least part of the variation between presidents captured
by the fixed-effects is actually maybe due to differing levels of GET. The
third variant, with country fixed-effects, is our preferred specification.
We can justify such a model on the grounds that structural slow-changing
country characteristics are likely to filter the effects of GET on popularity.
It is reasonable to suppose, therefore, that the equilibrium relationship
between the two variables might differ across countries and that there
exists a country-specific equilibrium level of popularity given GET.
As Figure 6.3 shows, the two ADL specifications yield very similar esti-
mates of the long-term effects of GET on popularity, according to each
variant. In the pooling and country fixed-effects models, the immediate
effect of GET on popularity is 0.21 (p-value = 0.03) and 0. 28 (p-value
< 0.01), respectively, converging in both cases to around 4.7 percentage
points in the long run. Estimates in the president fixed effects variant
are somewhat larger, converging to close to 5.7 percentage points in the
long run. It is also worth noting that the coefficients on the honeymoon
and lame-duck dummies are statistically significant in all specifications.
Estimates for the first varied between 2.5 and 3.8 whereas for the sec-
ond 1.2 and 1.4. The democratic transition counter is not statistically
distinguishable from zero in the pooled model, but implies a statistically
significant popularity bonus that starts at about 1 percentage points and
declines throughout the period according to the country and president
fixed-effects models.
These are, of course, average effects across our eight countries. These
estimates conform to our theoretical expectations laid out earlier in
the book. They indicate that presidential popularity follows exogenous
factors in the same way that other measures of political success do.
Together, these findings imply that voters are judging presidents based
on conditions presidents cannot control.
We believe, however, that these estimates do not reflect the full impact
of GET on popularity. This is because in the period for which we have
data, some of the countries in our sample experienced very traumatic
events that probably caused shifts in equilibrium popularity levels. Such

FIGURE 6.3 Effects of GET on popularity under different model specifications

Figure shows results for model that pools all the data, that include country fixed-effects,
and that include president fixed-effects. The pooled dataset has 2,767 monthly
observations, sorted into unbalanced panels of n=8, T=278–392 and n=51, T=1–165 for
the country- and president fixed-effects models, respectively.
shifts might very well muddle the statistical association between GET and
popularity.
In order to improve our analysis, we sought to identify periods in
which very ‘unusual’ ostensively non-economic circumstances were in
place in some of our countries. This is, obviously, an ad hoc enter-
prise, but in order to limit our discretion, we restricted ourselves to
adding dummy indicators for these unusual periods. This implies that
the dynamic relationship between GET and popularity should be more
or less stable through shifts in the equilibrium level of popularity given
GET.
We identified unusual periods in three of our cases. The motivation
and details of the coding decisions for Brazil, Colombia, and Peru are
presented in Appendix 6C to this chapter. Here, it suffices to say that
in Brazil we coded all months after the jornadas de junho protests of
2013 as ‘unusual.’ In Colombia we created a dummy indicator for the

6.5 Do Exogenous Conditions Affect Presidential Popularity? 151
FIGURE 6.4 Effects of GET on popularity accounting for ‘unusual’ periods

Figure shows results for model that pools all the data, that include country fixed-effects,
and that include president fixed-effects. The pooled dataset has 2,767 monthly
observations, sorted into unbalanced panels of n=8, T=278–392 and n=51, T=1–165 for
the country- and president fixed-effects estimation.
‘pacification’ period that extends from August 2002 through December

2007. In Peru, we employed a dummy for the ‘electoral authoritarian
period’ from February 1992 through November 2000. We did not iden-
tify any unusual periods for Argentina, Ecuador, Uruguay, and Venezuela
where there might have been shifts in the equilibrium levels of popularity
given GET, and which are not directly attributable to economic condi-
tions.11 Finally, the Chilean case is the only of the eight in which we
have reason to think that the nature of the relationship between GET
and popularity, and not just the level of this relationship, might have
in fact changed over time. We report, here, results without making any
adjustment to the common model, but return to the case in more detail
in Section 6.7.
11 In Argentina, for instance, there have been many ‘extraordinary’ periods since the late
1980s. All of them, however, seem very directly related to economic crises, and as such,
are probably a direct product of GET and should not be controlled for.

TA B L E 6.3 Effects of GET on popularity – including country specific

variations
Short-term Long-term Country specificities
Estimate Pr(>|t|) Estimate Med. Lag
Argentina 0.41 0.11 4.3 8

Brazil 1.80 < 0.01 15.8 5 Post-2013 crisis
Chile −0.53 0.075 −6.71 9
Colombia 0.57 0.04 7.5 9 Pacification period
Ecuador 1.30 < 0.01 15.4 8
Peru 0.18 0.520 1.76 7 Authoritarian
period
Uruguay 0.61 < 0.01 7.7 9
Venezuela 1.05 0.03 9.9 7
In Figure 6.4, we report the same time-series cross-sectional (TSCS)

models discussed earlier, but estimated with the inclusion of the dummy
variables for unusual periods in Brazil, Colombia, and Peru. Long-term
effects of one unit change in GET on popularity are now larger and less
varied than before, ranging from 5.2 to 7.5 percentage points, depending
on the actual specification.
Examination of country-by-country results obtained after including
our ad hoc adjustments, reported in Table 6.3, suggests that these aver-
age effects are not driven by a few countries. In every country but Chile,
GET has a positive effect on popularity. Short-term effects are very small
for Peru – which is the other exceptional case even after adjustments –
but range from just under half to close to three percentage points in pop-
ularity for the other six cases, and when the effect is not statistically
significant, it falls just short of conventional significance levels. Long-
term effects of a unit change in GET in the six conforming cases range
from 4.3 popularity points in Argentina to over double digits in Brazil
and Ecuador.
The general pattern is quite clear and present in six of our eight
cases. In Peru, we see no relationship between GET and popularity,
and in Chile we see a strong relationship that is opposite to what
our theory predicts. In the rest of this chapter, we turn to these two
deviant cases to discuss the extent to which they can inform our
theory.

6.6 The Peruvian Anomaly 153
FIGURE 6.5 Effects of GET on popularity in Peru

Figure shows the short- and long-term effects of a one-time one-unit change in GET on
popularity estimated on data available for Peru, accounting for periods of authoritarian
rule and ‘pacification’ following civil war. See text for details.
6.6 T H E P E R U V I A N A N O M A LY
Peru faced a period of of civil war against left-wing guerrillas that
were active in the countryside. This period was shorter and less intense
than the civil war in Colombia but not completely different. Peru also
experienced a period of electoral authoritarianism under President Fuji-
mori in the mid-1990s. Even after accounting for these periods in the
estimation, however, the connection between GET and popularity seems
tenuous, at best. This is quite different than what we found for Colom-
bia and Brazil, cases in which accounting for non-economic exceptional
circumstances increased the relationship between GET and popularity
markedly.
Figure 6.5 reports the common model estimated in the whole period,
which shows a weak negative association between GET and popular-
ity. We also report three variations in which we account for periods

of authoritarianism (also reported in Table 6.3), pacification, and both.

The long-term effects of GET on popularity, in these variations, are now
positive, but the effects are very small. They never reach two percent-
age points, which is substantially smaller than what we found in all
other cases. Moreover, the evidence suggests that Fujimori was more
popular during the non-democratic period. Of course, part of the prob-
lem is that the pacification and the authoritarian periods overlap in Peru,
making it impossible to distinguish entirely between the two pressures
on popularity. This is why, in fact, the model with dummies for both
the authoritarian and pacification periods yield results almost identical
to one with just the authoritarian dummy. When all is said and done,
however, it is clearly the case that Peru does not conform to our theory.
But how do we interpret these results? There are three distinct possi-
bilities. The simplest one is that GET does not have any impact on the
economic performance in Peru, which would imply that the first arrow in
our theoretical model, as described in Figure 4.3 is broken, and that the
GET index would not be a good measure of exogenous shocks in Peru. A
second alternative is that Peruvian voters, differently than their regional
neighbors, do not vote with the economy. This possibility, in turn, may
result from at least two different realities. The first, the most optimistic
of all, is that Peruvians observe and discount exogenous shocks when
evaluating their presidents, and this prevents any association between
GET and popularity. Knowing that the economy is largely determined by
factors beyond government control, Peruvians would vote according to
criteria other than the economy. Yet, it is also possible that GET affects
economic outcomes but, again, differently from other countries in the
region, these outcomes – inflation, employment, and growth – do not
affect voter welfare. This may happen due to a combination of many
different factors, among them the fact that exploration of commodities
is entirely in the hands of private enterprises, the very weak capacity of
the Peruvian state to extract resources from economic activity and redis-
tribute them, and an ‘enclave’ economy in which the countryside pays
the costs, and Lima receives the benefits of essentially a mining economy.
The evidence reviewed thus far weights heavily against the first alter-
native. We have seen, before, that Peru is highly exposed to both
commodities and to international interest rates (Figure 4.2) and that the
GET index predicts economic outcomes in South American countries, as
a group (Table 4.1 and Figure 6.1). In order to further explore whether
this holds in the specific case of Peru, we examined the time-series impact
of GET on growth and on the inflation, unemployment and the Okum

6.6 The Peruvian Anomaly 155
discomfort index, introduced in Chapter 4 and which combines both into

a single indicator.
For this analysis, we switched to quarterly observations, as this is the
periodicity for growth and also for the unemployment data (although
inflation data are available monthly). Another complication is that the
current unemployment series in Peru – based on the country’s permanent
household survey (ENAHO) and which we obtain from ECLAC – begins
only in 1995. A previous series extending from the late 1990s back into
the 1960s exists, but is restricted to the Lima Metropolitan area, and at
the time of writing, we had been unable to locate it in quarterly format
(INEI 2001).12 We obtained yearly figures for this series from (Garvito
2000, p. 24), imputed quarterly observations, and harmonized them with
the ENAHO series to generate data for all our period under analysis.13
We estimated ADL models of the sort described earlier, but using growth
and the economic discomfort index as dependent variables instead of
popularity.
Results suggest that GET does have an effect on the economy, espe-
cially on indicators of unemployment and inflation that are likely to
be widely experienced by voters. In the long term, one unit change in
GET leads to an increase in 0.31 in the growth rate. This same varia-
tion in GET, however, is associated with decreases of −1.12 in the log
of the inflation rate, and of −0.62 in unemployment. These effects are
quite substantial, implying a reduction in 0.77 standard deviations of the
economic discomfort index.14
This stands in contrast with what we find for the connection between
economic performance and popularity. The same sort of time series anal-
ysis indicates that one percentage point higher growth is associated with
just about one percentage point in popularity, in the long run. Not only
is this effect very small (it amounts to less than one-tenth of a standard
deviation in latent popularity), but this is an extremely noisy estimate,
as the effect is actually estimated to be negative for a few months after
a hypothetical growth shock. More importantly, even though we found
that GET had a strong effect on economic discomfort, we find essentially
12 This series is based on the Encuestas de Niveles de Empleo de Lima Metropolitana.

13 The interpolation was based on the quarterly seasonality observed in the post-1995
sereis. We then harmonized the two series by estimating the relationship between the
two series in the three years of overlap, and extrapolating this into the earlier period.
14 We performed the same general model search routine as we did for popularity, reporting
results for the ‘best’ ADL model for each indicator.

no effect of discomfort on popularity. A one point shock in the discom-

fort index leads to a meagre increase in popularity of 0.5 percentage
points. In standardized effects, this means that 0.4 standard deviation
change in economic discomfort leads to a long term change in popularity
of just over 0.03 standard deviations.
We conclude, from this analysis, that exogenous shocks do affect the
domestic economy in Peru, and the broken link actually occurs between
domestic economic performance and the vote. These results are consis-
tent with the very low popularity rates for all Peruvian governments
throughout the 2000s even though the country was one of the fastest-
growing economies in the region. The data currently available prevent
us from distinguishing whether this is a result of proper assignment of
responsibility or from some disconnection between macroeconomic indi-
cators and welfare, therefore we leave this intriguing puzzle for future
research.
6.7 C H I L E ’ S C O U N T E R C Y C L I C A L F I S C A L R U L E S
In the preceding analysis, we glossed over the details of Chile’s experi-
ence with structural budgeting laws. In Table 6.3, we reported results
for the common model, but important changes in the way the Chilean
government manages its budget might have affected the way in which
GET affects presidential popularity in the period under study. We suspect
that these rules do much more than just change the levels of popularity
given GET; they have, in fact, the potential to change the relationship
between GET and popularity itself. Therefore, in this section, we analyze
the Chilean case in greater detail.
It is a well-known fact that Chile’s economy is highly dependent on
copper. In 2013, at the tail end of the commodity super-cycle, cop-
per accounted for 20% of GDP and 60% of exports, and Chile’s GDP
growth tracked copper prices very closely (The Economist, April 13,
2013). Former central bank president, José de Gregorio, for instance,
noted that Chileans got used to ‘spending based on a higher copper
price’ (El Mostrador July 7, 2017). By 2017, dependence on copper had
waned somewhat, only to be replaced with fruit, salmon, and wine being
exported in large quantities to China (Quiroga 2017). In this context, the
negative association between GET and popularity of Chilean presidents
revealed in Table 6.2 is very surprising. We expected, a priori, that such
a relationship would be very strong in Chile.

6.7 Chile’s Countercyclical Fiscal Rules 157
One important feature of Chile, and which sets it apart from the rest
of Latin America and most of the developing world, is that the coun-
try has adopted a set of rules aimed at mitigating boom and bust cycles
caused by exogenous fluctuations in the prices of its main export com-
modities. These rules include a fiscal responsibility law, modern financial
management, a planning horizon that exceeds one year, a fiscal rule for
the budget, rules for government asset and liability management, require-
ments on accountability and public information on the government’s
financial management, effective external control and auditing, and estab-
lishment of a fiscal council and/or fiscal committees (Debrun, Hauner and
Kumar 2009; Ter-Minassian 2010).
These rules were introduced under President Ricardo Lagos, in the
wake of the Asian Crisis. The relatively large fiscal deficit of 1999
prompted the entering Socialist Party government to move boldly in
order to dispel doubts about the management of the budget (Galle-
gos Zuniga 2018). The rule that was actually implemented in 2001
without a legal mandate by Congress essentially committed the govern-
ment to a ‘structural’ surplus of 1 percent of the GDP (BCN 2018, p. 3).
‘Structural,’ here, is the operative term, and stands in opposition to ‘effec-
tive’ budget – the one that is actually observed at the end of each year. Its
structural nature is what gives the Chilean rule its countercyclical nature.
The early version of the rule also already stipulated that the key param-
eters for the calculation of the structural budget – the GDP trend and
the long-term prices of copper – be set on a yearly basis by independent
expert committees.
A bill with a modified version of these rules was eventually pre-
sented to Congress in the September of 2005, by the then outgoing
Lagos Government, but in agreement with the team of the soon to be
elected president Bachelet. It was passed into law in 2006 when Presi-
dent Bachelet was already well into her first year in office. The passage of
the bill was a watershed moment. Its drafting included recommendations
from organizations such as the International Monetary Fund, Interamer-
ican Development Bank, World Bank, and the OECD, and was hailed by
politicians from across the spectrum as one of the most important pieces
of legislation drafted (BCN 2018, p. 160) and approved with overwhelm-
ing support in both houses of parliament (BCN 2018, p. 40, 209, and
247). It was considered a successful step in the development of an insti-
tutional framework that strengthened the links between the fiscal rule,
the use of government savings, and the establishment of two sovereign
wealth funds (Schmidt-Hebbel 2012).

The so-called structural balance concept involves estimating the fiscal

income that would be obtained net of the impact of the economic cycle,
and spending only the amount that would be compatible with this level of
income. In practice, this means saving during good times, when revenues
known to be of only a temporary nature are received, and spending the
revenues when good times come to an end and fiscal revenue drops. The
structural balance indicator used in Chile nets out the cyclical impact of
three variables – the level of economic activity, the price of copper, and
that of molybdenum – that affect central government income.15 As such,
the structural balance reflects the financial results that the central govern-
ment would have shown in a particular year if the gross domestic product
had been at its trend level and copper and molybdenum prices had been
running at their long-term level. This mechanism allows to distinguish
the results in the fiscal situation that are caused by policy decisions from
those due to the cyclical impact of these variables (Rodríguez, Tokman
and Vega 2006). The current rules, however, do not require the govern-
ment run a specific surplus. The government must publicly state its fiscal
structural target within 90 days of taking office, and the rules subse-
quently impose year-by-year adjustments in spending so that the target is
met (Gallegos Zuniga 2018).
But, does structural budgeting actually work as implemented? And,
more importantly, what are the political economic conditions that allow
for the enactment of such laws? The success of structural budgeting has
been debated. According to the Ministry of Finance of Chile (Rodríguez,
Tokman and Vega 2006), this mechanism has permitted the implemen-
tation of a countercyclical policy, attenuating economic swings, allowed
for an accumulation of public savings during booms, helping to prevent
currency appreciation and safeguarding the competitiveness of the export
sector, reduced interest rate volatility, and boosted Chile’s credibility as
an issuer of international debt, reducing risk premium, improving access
to foreign finance during crises, and minimizing contagion from interna-
tional crises. Structural budgeting has insured the sustainability of social
policies, facilitating long-term planning, and helped cushion increases in
Chile’s country-risk during periods of economic crisis, if compared with
that of other countries (Acevedo et al. 2014).
However, reflecting on the the fiscal budgeting rules, the former pres-
ident of the Central Bank José de Gregório criticizes the existing rule by
15 The law actually states ‘price of copper or other factors of similar nature’ (BCN 2018,
p. 284).

6.7 Chile’s Countercyclical Fiscal Rules 159
pointing out that inertia in fiscal performance makes it hard to fine-tune

countercyclical policies. Once a stimulus is applied, the deficit it generates
carries over well beyond the point where no stimulus is needed anymore.
Whereas this is an important criticism, his proposed solution is not to
scrap such policies, but rather to increase their long-term horizons. That
is, they should be strengthened by taking fifteen years instead of a 10-
year horizon, as well as by creating an independent forecasting body to
deal with medium- to long-term fiscal projections (El Mostrador July 7,
2017).
If the structural budget does in fact attenuate the impact of commod-
ity cycles on fiscal policy, it should also change the relationship between
GET and popularity. Although the effects of GET on the local economy
are not solely channeled through ‘the fiscal path’ of government spend-
ing, governments’ fiscal condition and ability to spend certainly affect
presidential popularity.
In order to examine whether Chile’s countercyclical fiscal fund and
responsibility rules interfere in the relationship between GET and pop-
ularity, we allowed this relationship to vary between periods in which
different fiscal rules were in place. More specifically, we created two
dummy indicators that define three periods in the recent Chilean history.
The first is prior to the establishment of any fiscal responsibility rules
in 2001. The second is between the enactment of these rules and their
passing into law in August 2006, and the last period is since fiscal laws
have been in place. When then estimated the common model separately
in each of these periods to check for evidence that the country’s fiscal
rules might be ‘cushioning’ the transmission of international economic
conditions onto the Chilean economy, and therefore onto the popularity
of the country’s presidents.
Results, presented in Figure 6.6, are striking. The solid line reports
the unit response for the common model estimated in the whole period,
which was reported in Table 6.3 and in accordance with results from
the naive model reported in Table 6.2, it indicates the puzzling negative
effect of GET on popularity. The dashed line represents effects of GET on
popularity if estimated on data only from the period prior to the adoption
of the first infra-legal fiscal responsibility rules. The effects are not only
positive, but add up to a long-term change in 13.2 percentage points in
popularity, one of the strongest effects across all our cases, with a median
lag of just three months. This is what we expected from Chile – a country
extremely dependent on commodities.

FIGURE 6.6 Effects of GET on popularity considering Chile’s fiscal rules

Figure shows the short- and long-term effects of a one-time one-unit change in GET on
popularity estimated on different subsets of the popularity data available for Chile. See
text for details.
In the period when the rules existed but had not been passed into law,
the effect of GET was positive but smaller, converging to close to five
percentage points and after the rules were turned into law, this effect
reverts to a very strong negative effect.
The rules, of course, were not implemented for this reason, and there
is controversy in Chile as to how binding the fiscal law is. The Bachelet
government accused the previous Sebastián Piñera presidency of increas-
ing the deficit (El Mostrador July 7, 2017), and the accusation was
reciprocated by Piñera before taking office the second time, following
Bachelet (El Mostrador Online October 2, 2017). Still, it is interesting
to note that the existence of countercyclical laws shifted the terms of
the debate, and the media in Chile now commonly differentiates ‘struc-
tural deficit’ from the ‘fiscal deficit’ (El Mostrador January 30, 2018).
This fact, in and of itself, suggests that the fiscal rules might really have
an effect on the economy, and our results present very strong evidence

6.A Estimating Latent Popularity 161
suggesting that the fiscal rules did succeed in changing the relationship
between exogenous conditions and political success.
6.8 S U M M A RY
This chapter showed that international conditions captured by the GET
index, namely commodity prices and international interest rates, have a
substantial impact on the popularity of presidents in six of the eight cases
we analyzed. The patterns that we see are not compatible with voters dis-
counting the exogenous shocks. The only possible interpretation of these
results is that citizens simply vote based on the economy, regardless of the
fact that a significant portion of economic performance is not attributable
to the incumbent governments. This is a macro-level evidence that vot-
ers are, in fact, misattributing responsibility for economic performance.
Chapter 7 explores potential drivers of this behavior.
APPENDICES
6.A E S T I M A T I N G L A T E N T P O P U L A R I T Y
The dyad ratios algorithm is built on the assumption that the raw survey
observations are different measures of the same latent quantity that we
are interested in, which is popularity. In order to conduct the smoothen-
ing procedure, we first determined which raw observations were part of
comparable series. If the pollster has employed two different samples (e.g.
national and urban areas only) or two different questions (e.g. popular-
ity and approval) we treated them as separate series. While harmonizing
the different series, WCALC also imputes missing observations based on
smoothening of the latent popularity over time.16 We applied WCALC
to generate both monthly and quarterly estimates of the popularity of
presidents. While we work mostly with monthly datasets, in some occa-
sions availability of economic data required us to move to quarterly
data.
In order to understand the effects of this procedure, consider the
comparison between WCALC estimates of popularity with a simpler
16 We discarded periods in which WCALC used data from two different presidents in
the interpolation, which generated some missing data at the start and at the end of
presidencies.

FIGURE 6.7 Example of raw and latent popularity (Brazil, 1985–2016)
indicator, we generated by averaging all the observations in a given calen-

dar month and subsequently linearly interpolating the values in months
for which we had no raw observations. This standard deviation in the
LIA is 19.6, while in the WCALC series it is 15.9. This has two important
implications. First, all results that we find were stronger using LIA than
using WCALC, and we decided to report the more conservative results.
More importantly, the substantive results we report should be evaluated
taking into consideration that total variance in the data is smaller than
what one would see if examining raw popularity figures, which makes
these results even more substantively relevant.
Figure 6.7 shows an example of the procedure that was employed
to generate each country’s popularity series. The small dots are the raw
data points that we collected for Brazil, which came from several differ-
ent pollsters. The dashed line is LIA series, which combines all the data
points in each calendar month, computes the average for the period, and
interpolates missing months.17 The solid lines are WCALC’s estimate of
17 We did not interpolate missing months at the start of the end of presidential terms.
In these cases, we computed a linear prediction of the missing months based on the
adjacent observed months for the same president.

6.B Venezuela as a Democracy 163
latent popularity in its monthly (darker) or quarterly (lighter) variants.

In the case of Brazil, because the data were quite well spread out in time,
and because the main pollsters tend to generate very similar estimates, the
three series are quite similar. In some countries, especially when differ-
ent pollsters dominate the dataset in different periods, with little overlap
between the series, there is sometimes more distance between the averag-
ing approach and WCALC. This could eventually be overcome obtaining
more data, but we were limited to the data at hand at the time of writing.
Still, the correlation between LIA and WCALC estimates in the pooled
sample of eight countries is 0.91 (p-value< 0.01).
6.B V E N E Z U E L A A S A D E M O C R A C Y
We restricted the use of data from Venezuela for the period in which
the country could be considered democratic. Most analysis would agree
that at the time of writing of this manuscript, Venezuela is no longer
a democracy. Most would also agree that the country has been sliding
away from democracy since at least the coup d’état against Chávez in
2002, but there is much less agreement about when exactly Venezuela
crossed the threshold to fail to qualify as a democracy.
As democracy levels declined, so did the trustworthiness of popularity
data. Under these circumstances, it is hard to assure that responses to
pollsters are truthful, as the population as well as pollster companies may
fear their consequences in repressive regime. Moreover, with increasingly
concentrated powers in the hands of the president, there is also increased
room to manipulate the economy to produce short-term benefits that
later turned into a long-term disaster. For all these reasons, we accounted
for democratic breakdown in the analysis of Venezuelan data and only
used data during the period in which the country could be considered a
democracy.
In the cross-national study of elections in Chapter 3 we still consid-
ered Venezuela’s December 2006 elections as democratic. The country’s
Polity 2 score for that year was still five, and most elections were deemed
free by international observers at the time. Chávez’s wide margin of vic-
tory (roughly 63 percent vs. 37 percent) was not incompatible with his
very high popularity levels at the time. Two subsequent milestones sug-
gest that it is reasonable to consider Venezuela democratic after this
election as well. In December 2007, the country held a referendum on
constitutional reforms that included changes to term limits that would
allow Chávez to run for a third term. Not only was Chávez’s position

defeated (albeit narrowly), but at the time the government actually rec-
ognized defeat and respected the electoral results. Then, in the local
elections of November 2008, despite some legal disputes over eligibility
of certain candidates, the opposition was victorious in Venezuela’s largest
states and cities.18
The event we consider to initiate the transition to an authoritarian
regime was the February 2009 second constitutional referendum when
Chávez’s position was victorious and term limits were eliminated. Not
only is the decision of allowing Chávez to run for reelection indefinitely
highly questionable from the democratic standpoint, but he immediately
vowed to remain in power for at least another decade. More importantly,
the government used all its resources to back its position in the referen-
dum, in a way that would typically not be considered democratic. Polity 2
codes the period between 2006 and 2008 as a 5, but registers a −3 for
2009 and the subsequent years, which also leads credence to this being
the end of Venezuela’s democracy. The vote itself, however, was deemed
free and fair by Latin American and European international observers.19
Another possible turning point is the October 2012 presidential elec-
tion, when Chávez defeated Henrique Capriles (55 to 44 percent) and
was elected for a fourth term. In spite of some intimidation directed
toward the opposition candidate, there is a wide consensus that Chávez
effectively won this election as he was still very popular. Following
his reelection, however, Chávez fell terminally ill and in early 2013
he appointed Maduro as his successor, essentially from his deathbed.
This ‘transition’ was definitely not democratic, and set the stage for the
Nicolás Maduro’s hotly contested and very narrow electoral victory in
April 2013. In this sense, the October 2012 election is the last reasonable
moment for considering Venezuela a democracy.
6.C C O D I N G O F ‘ U N U S U A L’ P E R I O D S
In three countries in our sample, we identified ostensively non-economic
watershed moments that shifted what we refer to as the ‘equilibrium’
popularity level given GET. This means the effect of changes in GET on
18 Opposition candidates won the election in the municipality of Caracas, as well as the
states of Miranda, Carabobo, Monagas, Nueva Esparta, Táchira, and Zulia.
19 See ‘Chávez Wins Removal of Term Limits,’ Juan Forero, Washington Post Foreign Ser-
vice Monday, February 2, 2009, and also ‘Chávez Decisively Wins Bid to End Term
Limits,’ Simon Romero, New York Times, February 15, 2009.

6.C Coding of ‘Unusual’ Periods 165
changes in popularity might have continued the same, but the baseline
level of popularity for a given level of GET probably changed. We review,
below, the justification and coding of these periods.
BRAZIL : Although naive results from Table 6.2 show that GET has a
very strong effect in Brazil, these are substantially lower than what
we found in previous work, with a shorter time series (Campello and
Zucco Jr. 2018). This loss in explanatory power is completely driven by
the political crisis that followed the jornadas de junho protests.
In June 2013, the country was engulfed in political turmoil which
started at the municipal level with protests against bus tariff rises. The
protests expanded to the state level as police repression turned out very
violent. Finally, as they spread all over the country, protests gained a
national character that was absent early on. President Dilma Rousseff’s
response calling for a new constitution concluded the nationalization of
these events. As protests persisted in what the media started to call the
Brazilian Spring, Dilma saw her popularity plummet, and levels never
returned to previous values.
In order to account for this arguably exogenous shock to the function-
ing of Brazilian politics, we coded a dummy indicator that takes on the
value of one for all months following June 2013. The estimated effect of
GET on popularity using data up to June 2013 is identical to what we
find using the whole period and adding this dummy, which reinforces the
idea that a one-time level-shift occurred, and we estimate that in the post-
2013 period, popularity levels given GET were −4.23 popularity point
lower (p < 0.001).
COLOMBIA : While data from Colombia generally conform to our expec-

tations, Uribe’s popularity during most of his first term in office was
higher than what GET would predict. This period corresponds to Colom-
bia’s ‘pacification.’ It is reasonable to expect that the the civil conflict was
salient enough an issue to muddle the relationship between GET and pop-
ularity of presidents in Colombia. Had the conflict been a constant – so
to speak – in the period under study, we could probably simply ignore it.
The conflict, however, was a multifaceted affair, involving mostly – but
not only – left-wing guerrilla groups, right-wing paramilitaries, and gov-
ernment security forces, and whose intensity varied even if we consider
only the period from 1994 through 2017 for which we have popularity
data.

In order to identify as exactly as possible the pacification period, we

examined Colombia’s Centro Nacional de Memória Histórica’s encyclo-
pedic report on the evolving character of the country’s civil war that
compiled a list of 1,755 guerrillas attacks on villages and town between
1965 and 2013 (Centro Nacional de Memoria Histórica 2016). In our
period of interest, several indicators suggest that intensity of the con-
flict increased dramatically between 1993 and 1999 and then oscillated
somewhat at high levels until 2002. At this point, violence decreased
substantially through 2007 and then continued on at much lower levels.
Data from the Instituto Nacional de Medicina de Colombia corroborates
the same picture, showing that the total number of homicides in the coun-
try peaked in 2002, and that the number of yearly deaths attributable
to the conflict fell steadily from 2003 – the first year for which figures
are disaggregated into conflict and non-conflict related. We can see, for
instance, that conflict-related deaths fell by almost two-thirds between
2003 and 2008, and then by roughly the same proportion through 2015
(Table 6.4). We, therefore, coded the ‘pacification’ period as extending
from August 2002 through December 2007.20
Including a dummy indicator for the pacification period amounts to
assuming that there was a popularity bonus to be reaped by reducing
violence, but that this is ‘one-time’ effect. Likewise, we assume that prior
to the reduction in violence, the civil war was more or less a constant,
and already priced into the evaluations of presidents. This is a reasonable
assumption because our data start at the end of 1994, therefore missing
the previous peak in violence in the late 1980s. Our estimates indicate
that popularity during the pacification period was 2.62 percentage points
higher (p < 0.001) given levels of GET.
PERU : We explored two exceptional circumstances in Peru. As

Venezuela, Peru experienced a period of electoral authoritarianism, and
20 We obtain essentially the same results if we start this period earlier (in January 2002,
for instance) and/or end it later (December 2008, for instance). However, we choose
these dates because they match the aggregate violence numbers mentioned above, and
also the accounts that highlight the demobilization of the paramilitary group United
Self-Defense Forces of Colombia (AUC) as a crucial turning point in the conflict. The
immediate triggers of this process were the Ley 782, issued on December 23, 2002 and
the truce declared by the AUC’s leader Carlos Castaño, both of which happened in
December 2002. These events, however, are intimately linked to Uribe’s inauguration,
which happened in August 2002.

TA B L E 6.4 Violence indicators in Colombia

(1994–2017)
Year Deaths
Conflict Total
1994 26,670
1995 25,098
1996 26,642
1997 25,379
1998 23,095
1999 24,358
2000 26,540
2001 27,841
2002 28,837
2003 3,274 22,199
2004 2,713 18,888
2005 2,077 15,031
2006 2,134 14,616
2007 2,043 16,318
2008 1,239 15,250
2009 1,042 17,717
2010 1,162 17,459
2011 938 16,554
2012 881 15,727
2013 639 14,294
2014 536 12,626
2015 346 11,585
2016 210 11,532
Data on sociopolitical deaths for 2003 are from
INMLCF (2004, p. 44); for other years from
INMLCF (2017, p. 101). Data on total deaths for
years for all years up to 2004 are from INMLCF
(2005, p. 51), for 2005–2006 are from INMLCF
(2008, p. 26), and for 2007 and subsequent years are
from INMLCF (2017, p. 109).
as Colombia, it experienced a bloody – though shorter – civil war against

leftist insurgent groups.
The country slid back into authoritarian rule in February of 1992,
when Fujimori launched a successful autogolpe. Although elections were
held in 1994 and again in 1999, the government prevented specific
individuals from running, and in 1999 the main opposition candidate
withdrew from the run-off citing fraud. Soon thereafter, Fujimori fled

6.5 Violence
TA B L E
indicators in Peru
(1980–2000)
Year Deaths
1980 23
1981 49
1982 576
1983 2,256
1984 4,086
1985 1,397
1986 920
1987 1,135
1988 1,470
1989 2,400
1990 2,327
1991 1,837
1992 1,771
1993 1,016
1994 411
1995 290
1996 177
1997 140
1998 105
1999 86
2000 35
Data are from Carrillo (2004,
Annex 2).
the country and was removed from office by Congress on November

21, 2000, ostensibly due to ‘moral incapacity’ to govern. Polity 2 scores
match this account, with the country being coded as not democratic from
1992 to 1999 (inclusively).
Throughout much of the 1980s and 1990s, the Sendero Luminoso
(Shining Path) and Movimiento Revolucionario Túpac Amaru (MRTA)
waged guerrilla warfare in the countryside and sought to bring the con-
flict to Lima. In the early 1990s, the Shining Path carried out a number
of high profile attacks in Lima, at which point the government began a
counter-offensive. The arrest of Abimael Guzmán Reynoso, the leader of
the Shining Path, in September 1992 marks a turning point in the conflict.
As data collected from the final report of Peru’s Truth and Reconciliation
Commission (Lerner Febres 2003, Annex 2) and reported in Table 6.5

show, after spiking in 1990 and remaining high through 1992, the num-
ber of victims fell dramatically and by 1995 had reached levels not seen
since the start of the conflict in the early 1980s.21 Likewise, the num-
ber of districts in which there was guerrilla activity also fell in the same
period (Lerner Febres 2003, p. 24). In order to capture these exceptional
circumstances, we created one dummy variable to indicate the authori-
tarian interlude of the mid 1990s and another to capture the pacification
period, much in the same way we did in Colombia, which we defined as
extending from September 1992 through November 1995. The precise
end-date of the this period is debatable, but we used the imprisonment of
Miguel Rincón Rincón, Lori Berenson, and other leaders of the MRTA
as the milestone (Carrillo 2004, Annex 1, p 257).
In a model in which we include only the dummy that identified the
authoritarian period, which is discussed in this chapter, Section 6.6, we
find that popularity was 1.35 higher given GET than in the rest of the
periods for which we have data (p = 0.04).
21 The data in the report cover only around 22,000 deaths officially reported. Total
estimated deaths were approximately 70,000 (Carrillo 2004, Annex 2).

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6

International Conditions and Popular Support

We have learned in the previous chapters that presidents’ fates in

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

disadvantages, which suggest that any comparative analysis of popularity

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

In Chapter 4, we showed that our measure of exogenous economic con-

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

FIGURE 6.1 Unit reponse of economic outcomes to GET

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

ratios algorithm’ (WCALC) to smoothen the series, imputed missing val-

4 Specifically, we used the extract() function, which is an implementation of WCALC

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

TA B L E 6.1 Periods under consideration by country

Raw Obs Pollsters Total Imputed First Last

later arguably ceased to qualify as a democracy. We return to this con-

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

FIGURE 6.2 Average popularity of presidents (1988–2017; 5–8 countries)

one unit is equivalent to one standard deviation), the latent popularity

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

TA B L E 6.2 Simple association between GET and

Argentina 3.91 <0.01 0.26

we account for shifts in levels of popularity during the non-democratic

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

also from unanticipated interruptions in presidential terms.6 In order to

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

dictatorship. Sarney initially took office as interim president following

MOTIVATING OUR DYNAMIC MODEL : In order to determine the most

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

Another important consideration is that popularity and the GET index

EMPIRICAL MODEL SEARCH : Our theoretical expectations are simply

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

dissipate. For this reason, we rely on empirical criteria to choose the

Pt = α0 + α1 Pt−1 + α2 Pt−2 + β0 GETt + β1 GETt−1 + β2 GETt−2 + γ Xt t ,

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

PRESENTING THE RESULTS : Instead of reporting tables of coefficients,

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

Each of these variants implies a different conception of the long-

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

FIGURE 6.3 Effects of GET on popularity under different model specifications

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

FIGURE 6.4 Effects of GET on popularity accounting for ‘unusual’ periods

‘pacification’ period that extends from August 2002 through December

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TA B L E 6.3 Effects of GET on popularity – including country specific

Short-term Long-term Country specificities

Estimate Pr(>|t|) Estimate Med. Lag

Argentina 0.41 0.11 4.3 8

In Figure 6.4, we report the same time-series cross-sectional (TSCS)

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

FIGURE 6.5 Effects of GET on popularity in Peru

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

of authoritarianism (also reported in Table 6.3), pacification, and both.

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

discomfort index, introduced in Chapter 4 and which combines both into

12 This series is based on the Encuestas de Niveles de Empleo de Lima Metropolitana.

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

no effect of discomfort on popularity. A one point shock in the discom-

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press

The so-called structural balance concept involves estimating the fiscal

https://doi.org/10.1017/9781108894975.006 Published online by Cambridge University Press