Getting Closer When It’s Close

A guest post by Oliver Strijbis, Sveinung Arnesen, Kjetil Thuen, and Lucas Rachow*

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Two weeks ago we published on this blog the predictions taken from our prediction market on the outcome of the ballots from March 3. The predictions were taken on February 22 – nine days before the official voting day. Our predictions deviated from the official results from 0.3% to 6% depending on the ballot. After one year of experience with prediction markets we come to the conclusion that this result is largely representative of our predictions over the last year.

The prediction on the Yes-vote for the “Bundesbeschluss über die Familienpolitik” was a strike. The prediction was that 54.6% of the voters would be in favor of the law while on voting day it was 54.3% (0.3% deviation). With only 3.2% deviation also our prediction on the “Raumplanungsgesetz” was rather accurate: while we expected a Yes-share of 59.7% on voting day it was 62.9%. The least precise prediction was on the share of Yes-votes for the “Abzocker-Initiative” – the most hotly debated proposal – where we expected 61.9% Yes-votes against the resulting 67.9% (6% deviation).

The predictions were rather representative of our experience with the prediction market since our first try one year ago. First, the predictions have been more precise the closer the outcome was. This is clearly reflected in our experience with the 26 ballots (15 national and 11 cantonal) for which we made predictions during the last year. Secondly, the accuracy of our predictions were within the range that we found for the predictions made previously. While the accuracy is typically within a 5% margin of error when the Yes-votes are between 40% and 60% it gets larger when the outcome is more clear (as with the “Abzocker-Initiative”).

Overall, after one year of applying our prediction markets to Swiss direct democratic decisions we can conclude that they have considerable potential. While they might not necessarily be equally precise as electoral forecasts they clearly allow to get a good feeling about the probable outcome of ballots at an early stage of the campaign and in particular when the race is close.

* Oliver Strijbis is a postdoctoral researcher at the University of Hamburg, Sveinung Arnesen is a postdoctoral researcher at the University of Bergen. Together with Kjetil Thuen and Lucas Rachow they are founders of politikprognosen.ch.

The metamorphosis of an old political institution

(with Karima Bousbah)
The Swiss political system provides a few institutional veto points, which were originally thought to protect the catholic minority, organised around the Christian Democratic Party (CVP). After a re-configuration of the political conflict lines, the ‘Ständemehr’ now seems to serve the interest of the Swiss People’s Party (SVP), at the detriment of the CVP.  

Campaign against the new constitutional article on child care

In Switzerland, all constitutional amendments need to be approved in compulsory referendums by both the majority of people (Volksmehr) and the majority of cantons (Ständemehr). This “cantonal veto” was originally introduced in order to accommodate the catholic minority, and as a veto card of their political arm, the Christian Democratic Party (CVP). Historically, the Christian Democrats (CVP) could count on very large majorities among voters in the catholic cantons of Switzerland. On average, the catholic cantons are considerably smaller than the protestant cantons, and thus, they can use the Ständemehr to bloc constitutional amendments.

In the past 165 years, there have been only nine instances in which the Ständemehr had a direct effect. Meaning that, so far, in the history of Swiss direct democracy the majority of cantons has overruled the majority of the voters on nine different referendums on constitutional articles. However, it is possible that the Ständemehr had furthermore very strong anticipatory effects on parliamentary decision-making: in the last 100 years (this is the period for which voting recommendations by the political parties are available), there has been only one constitutional amendment opposed by the CVP, which was subject to a popular vote. It reached voters’ majority approval only in three (mainly protestant) cantons.

In a newspaper article, which appears on Tuesday, I am suggesting that the Ständemehr might, over time, have evolved into a veto card working in favour of the Swiss People’s Party (SVP). Since the 1990s, the constitutional amendments on which small and rural cantons have differed most strongly from the will of the voting population, dealt with questions of a conservative-liberal nature, or were related to the issue of political opening (European Union, United Nations, etc). Nowadays, on all these issues, the CVP is usually (and increasingly) aligned with both the parliament’s and the government’s , whereas the SVP stands in clear opposition. The SVP, however, increasingly finds support in the small, rural cantons, and while the CVP still predominates in electoral terms, the SVP has increased its influence in referendum votes in these cantons. This implies that the Ständemehr could turn into a veto card in the hands of the Swiss People’s Party (SVP).

Among the nine constitutional referendum instances, in which there has indeed been a difference between the majority of the people and the majority of the cantons, two occurred in 1994, and one occurred this last Sunday (3rd of March 2013). In 1994, the constitutional referendum addressed the promotion of arts; it was opposed only by the SVP and the small Liberal Party (representing 3% of the electorate). The constitutional amendment was blocked by the majority of the cantons.

This Sunday, the Ständemehr struck back again. The referendum was on the issue of a constitutional article on families (the controversy was mainly about child care). Also in this case it was the SVP (supported by parts of the Free Democratic Party), which politicised the issue along a conservative-liberal dimension. In the end, the SVP managed to defeat the article with the help of the Ständemehr. Given that the Swiss People’s Party (SVP) is nowadays quite strong, especially in the small cantons, and is often in opposition with parliament on conservative-liberal issues, we could actually expect an increase of referendums, where the Ständemehr is decisive, i.e. overruling the population’s majority. One thing, however, is particularly ironic about the failed referendum of Sunday: the veto card – originally thought to function as a the veto of the catholic minority (i.e. CVP) – was now used by the SVP to defeat a bill initiated by the CVP.

Predictions for the Ballots on March 3

This is a guest post by Oliver Strijbis, Sveinung Arnesen, Kjetil Thuen, and Lucas Rachow*

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About one year ago we published on this blog for the first time predictions for direct democratic votes taken from our “prediction market”. Prediction markets are designed to aggregate information and produce predictions about future events. Prediction markets are markets for contracts that yield payments based on the outcome of an uncertain future event, such as an election or a referendum. A considerable bulk of literature has shown that prediction markets can easily compete with surveys in forecasting election outcomes. This has also been shown for the Swiss parliamentary elections in 2011 where the forecasts of the prediction markets were more accurate than those of the surveys (Tagesanzeiger online, 27th October 2011).

Predicting election results, however, is clearly easier than results from direct democratic votes. And indeed, the accuracy of our forecasts published one year ago were rather mixed. We identified several reasons why this might have been the case. One reason is that predictions are easier if there is abundant information, which is clearly more so for national elections than for initiatives and referenda. There is little to do about that and predictions on direct democratic votes might always be somewhat less precise than election forecasts.

However, as another major reason for the rather large variance in the accuracy of our predictions we hypothesized that the participants need to learn. As a consequence, we decided to further develop our prediction market and applied it to the ballots of May, September, and November 2012. This allowed us to maintain a rather small though faithful community of traders. In order to test our hypothesis that for the prediction of direct democratic votes the ability of the traders is particularly important, we also made use of the knowledge about their behavior in previous rounds. In order to give the best traders more influence, they could now keep playing with the raised overall amount of money from the previous prediction cycle (all participants would win between 20 and 150 Swiss francs). Hence, the ballots from March 3 will allow us to test how important the ability of the traders in the market actually is for the accuracy of our predictions.

What, then, does our market foresee for the ballot of March 3? Here are our predictions from February 22: 61.9% yes for the “Abzocker-Initiative”, 54.6% yes for the “Bundesbeschluss über die Familienpolitik”, and 59.7% yes for the “Änderung des Bundesgesetzes über die Raumplanung”. Hence, for all three proposals we anticipate a rather clear victory.

* Oliver Strijbis is a postdoctoral researcher at the University of Hamburg, Sveinung Arnesen is a postdoctoral researcher at the University of Bergen. Together with Kjetil Thuen and Lucas Rachow they are founders of politikprognosen.ch.

Predictions for the Ballots on March 11

A guest post by Oliver Strijbis, Sveinung Arnesen, Kjetil Thuen, and Lucas Rachow. Oliver Strijbis is a postdoctoral researcher at the University of Hamburg, Sveinung Arnesen is a postdoctoral researcher at the University of Bergen. Together with Kjetil Thuen and Lucas Rachow they are founders of politikprognosen.ch.

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Who thinks in predictions of election and referenda outcomes thinks in surveys. However, an alternative method for forecasting has made its way into political science the last years. So called “prediction markets” are designed to aggregate information and produce predictions about future events. Prediction markets are markets for contracts that yield payments based on the outcome of an uncertain future event, such as an election or a referendum. A considerable bulk of literature has shown that prediction markets can easily compete with surveys in forecasting election outcomes. This has also been shown for the Swiss parliamentary elections in 2011 where the forecasts of the prediction markets were more accurate than those of the surveys (Tagesanzeiger online, 27th october 2011).

In an attempt to apply prediction markets in the context of Switzerland’s direct democracy we set up prediction markets for the ballots of March 11. We arrive at forecasts by setting up a market for each of the proposals. This means that on each of five markets the outcome of one proposal is treated as an asset. At voting day an asset pays the share of votes the proposal has received. For instance if the proposal “Schluss mit uferlosem Bau von Zweitwohnungen!” gets 45% of the votes, the final price of an asset of this proposal pays 45 units. Hence, a participant on the prediction market has an incentive to buy assets if the price is below 45 units and an incentive to sell if it is above. Consequently, rational players will buy assets if the current price is below the expected outcome and sell if it is above.

With the assistance of colleagues from various Swiss universities (special thanks to Laurent Bernhard) we were able to recruit 124 individuals of which 87 turned out to be active participants. In an attempt to recruit only the most talented players we were primarily approaching political scientists (students and professionals) and individuals trained in a related field. From the 87 participants 27% were political scientists, 21% economists, and 22% were trained social scientists from other disciplines. The participants are compensated with a small salary depending on their performance.

While theory tells us that our proceeding should yield accurate forecasts, only empirics can demonstrate it. So what do the prediction markets tell us for the ballots on March 11? Here are our predictions from March 3 (see Figure): 46.7% yes for the “Bauspar-Initiative”, 45.5% yes for the law on the “Buchpreisbindung”, 39.9% yes for the initiative “6 Wochen Ferien für alle!”, 70.5% yes for law on the “Neuregelung der Geldspiele”, and 45.5% yes for the initiative “Schluss mit uferlosem Bau von Zweitwohnungen!”. Hence, for all three proposals where a close race is expected we anticipate a narrow defeat.

Who should elect the Swiss government? The Swiss People’s Party’s strategy as a boomerang

The Swiss People’s Party (SVP) wants Swiss voters to elect the Swiss government (Federal Council) in a direct vote. Today, they submitted a popular initiative, proposing an amendment to the constitution, to the authorities. They were required to collect the signatures of 100,000 citizens for this aim, and now, Swiss voters will be given the opportunity to decide on this proposal in a popular vote in the years to come – unless the party should withdraw its initiative in the meanwhile. As of now, it’s the legislative assembly that elects the government every four years, without any possibility of removing the government from office.

Usually, amendments to the electoral systems are proposed by political parties that expect to profit from such changes. It is not very surprising that the proposition to change the election modus for the Swiss government comes from the Swiss People’s Party. Although the Swiss government is usually composed of a large coalition, and mandates are almost proportionally allocated to the largest parties according to their share of parliamentary seats, in recent elections, the SVP has experienced difficulties to get represented in proportional terms, and/or the parliament refused to elect their official candidates (as they often did, in earlier periods, with Social Democratic candidates).

Surprisingly, however, our analysis shows that the SVP might be an important loser of the change in the electoral rules. In a newspaper article (available in German and in Italian), Karima Bousbah and myself discussed whether the SVP might profit from such a change in the election mode. Therefore, we have analysed the elections of the governments in 22 Swiss cantons, which are already elected directly, according to the same rules as they would apply at the national level. (While in the newspaper articles, we solely report correlation analyses, and some descriptive data, we also used panel data over the last 20 years, in order to understand why and when the SVP manages to win seats in governments, and when not.)

Similarly as at the national level, and despite the direct election by majority rules, cantonal governments are large coalitions, which roughly follow the rules of proportional seat allocation. Only the SVP is severely under-represented, holding 23% of the mandates in cantonal parliaments, but only 14% of the governmental seats. The SVP addresses right-wing, conservative voters, but the position of the party branches used to vary across cantons, especially before a party split in 2008. The most radical branches of the SVP often have difficulties in building alliances to other parties. In order to get their candidates elected under majority vote systems, the SVP relies on the support of the other right-wing parties, the Liberals (FDP) and the Christian Democrats (CVP). Where the SVP has a very pronounced right-wing position, it has difficulties to do so.

Also, young party branches fail to get their candidates into governments. Before the 1990s, the party only existed in a few cantons. Elsewhere, the party has difficulties in finding experienced and credible candidates for governmental positions.

Certainly, dynamics in national elections might be slightly different than in cantonal ones, where public attention is low, and candidates are often unknown to the voters. Nevertheless, we argue that the cantonal elections might be the best available indicator of possible governmental elections at the national level.

So why does the SVP start such an initiative? Most likely, because the other parties are afraid of a direct election of the government, and the initiative serves the SVP as an instrument to receive certain concessions from the other parties, for instance in December this year, when the Swiss Parliament will elect the Federal Council. Probably this won’t be the last indirect election, though.

More on suicide rates and support for the gun control initiative

Some readers pointed out (please, leave a comment here next time!) that the relationship between suicide rates and support for the gun control initiative might be spurious. Well, it looks like it is:


Estimate Std. Error t value Pr(>|t|)
Suicide rate (females) 0.52 0.64 0.81 0.42
Suicide rate (males) -0.09 0.26 -0.32 0.75
German speaking -10.53 2.80 -3.77 0.00
Urbanization 0.09 0.05 1.76 0.09
% Catholics -0.15 0.07 -2.08 0.05
(Intercept) 47.74 11.52 4.15 0.00

However, controlling for urbanization and share of Catholics, there seems to be a correlation between suicide rates and percent of yes to the initiative — but only in non-German-speaking cantons:

Suicide rates and support for the gun control initiative

The gun control initiative was rejected yesterday by more than 56% of voters and in all but 6 cantons. One of the arguments advanced by advocates of the initiative was that stricter gun ownership rules would reduce suicide rates. So, was there more support for the initiative in cantons with higher suicide rates? Surprisingly, there is a strong correlation between approval and female, but not male, suicide rates. The relationship holds after controlling for language region:

Estimate Std. Error t value Pr(>|t|)
Suicide rate (females) 1.94 0.57 3.41 0.00
Suicide rate (males) -0.20 0.29 -0.68 0.50
German speaking -9.36 3.18 -2.94 0.01
(Intercept) 31.86 8.03 3.97 0.00

(OLS regression; dependent variable: % yes; N=26; R2=0.51)

Any ideas how we can explain the difference?

UPDATE: more analyses here.