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Risk perceptions and politics: Evidence from the COVID-19 pandemic

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  • Barrios, John M.
  • Hochberg, Yael V.

Abstract

Politics may color interpretations of facts, and thus perceptions of risk. We find that a higher share of Trump voters in a county is associated with lower perceptions of risk during the COVID-19 pandemic. Controlling for COVID-19 case counts and deaths, as Trump's vote share rises in the local area, individuals search less for information on the virus and its potential economic impacts, and engage in fewer visits to non-essential businesses. Our results suggest that politics and the media may play an important role in determining the formation of risk perceptions, and may therefore affect both economic and health-related reactions to unanticipated health crises.

Suggested Citation

  • Barrios, John M. & Hochberg, Yael V., 2021. "Risk perceptions and politics: Evidence from the COVID-19 pandemic," Journal of Financial Economics, Elsevier, vol. 142(2), pages 862-879.
    • Handle: RePEc:eee:jfinec:v:142:y:2021:i:2:p:862-879
    DOI: 10.1016/j.jfineco.2021.05.039
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    Cited by:

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    2. Lucia Freira & Marco Sartorio & Cynthia Boruchowicz & Florencia Lopez Boo & Joaquin Navajas, 2021. "The interplay between partisanship, forecasted COVID-19 deaths, and support for preventive policies," Palgrave Communications, Palgrave Macmillan, vol. 8(1), pages 1-10, December.
    3. Phalippou, Ludovic & Wu, Betty, 2023. "The association between the proportion of Brexiters and COVID-19 death rates in England," Social Science & Medicine, Elsevier, vol. 323(C).
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    5. Pronkina, Elizaveta & Rees, Daniel I., 2022. "Predicting COVID-19 Vaccine Uptake," IZA Discussion Papers 15625, Institute of Labor Economics (IZA).
    6. Coven, Joshua & Gupta, Arpit & Yao, Iris, 2023. "JUE Insight: Urban flight seeded the COVID-19 pandemic across the United States," Journal of Urban Economics, Elsevier, vol. 133(C).
    7. , 2023. "The Political Consequences of Vaccines: Quasi-experimental Evidence from Eligibility Rules," Working Papers 953, Queen Mary University of London, School of Economics and Finance.
    8. Yijia Wen & Li Fang & Qing Li, 2022. "Commercial Real Estate Market at a Crossroads: The Impact of COVID-19 and the Implications to Future Cities," Sustainability, MDPI, vol. 14(19), pages 1-16, October.
    9. Xiqian Cai & JunJie Wu & Wenchao Xu & Jialiang Zhu, 2024. "Negative emotions increase unhealthy eating: Evidence from the Wuhan lockdown during COVID‐19," Health Economics, John Wiley & Sons, Ltd., vol. 33(4), pages 604-635, April.
    10. Scott R. Baker & Robert A Farrokhnia & Steffen Meyer & Michaela Pagel & Constantine Yannelis, 2023. "Income, Liquidity, and the Consumption Response to the 2020 Economic Stimulus Payments," Review of Finance, European Finance Association, vol. 27(6), pages 2271-2304.
    11. Furst, Rodrigo & Goldszmidt, Rafael & Andrade, Eduardo B. & Vieites, Yan & Andretti, Bernardo & Ramos, Guilherme A., 2024. "Longitudinal attenuation in political polarization: Evidence from COVID-19 vaccination adherence in Brazil," Social Science & Medicine, Elsevier, vol. 348(C).
    12. Lisa Yao Liu & Shirley Lu, 2023. "The Effect of Firms' Information Exposure on Safeguarding Employee Health: Evidence from COVID‐19," Journal of Accounting Research, Wiley Blackwell, vol. 61(3), pages 891-933, June.
    13. Ambrocio, Gene & Hasan, Iftekhar, 2022. "Belief polarization and Covid-19," Bank of Finland Research Discussion Papers 10/2022, Bank of Finland.
    14. Jianwei Huang & Mei-Po Kwan, 2022. "Examining the Influence of Housing Conditions and Daily Greenspace Exposure on People’s Perceived COVID-19 Risk and Distress," IJERPH, MDPI, vol. 19(14), pages 1-19, July.
    15. Basu, Arnab K. & Chau, Nancy H. & Firsin, Oleg, 2023. "Social Connections and COVID-19 Vaccination," IZA Discussion Papers 16307, Institute of Labor Economics (IZA).
    16. Li, Xiang, 2022. "The role of state-owned banks in crises: Evidence from German banks during COVID-19," IWH Discussion Papers 6/2022, Halle Institute for Economic Research (IWH), revised 2022.
    17. Bird, Matthew D. & Arispe, Samuel & Muñoz, Paula & Freier, Luisa Feline, 2023. "Trust, social protection, and compliance: Moral hazard in Latin America during the COVID-19 pandemic," Journal of Economic Behavior & Organization, Elsevier, vol. 206(C), pages 279-295.
    18. Rahman, Md Lutfur & Al Mamun, Mohammed Abdullah, 2021. "How resilient are the Asia Pacific financial markets against a global pandemic?," Pacific-Basin Finance Journal, Elsevier, vol. 69(C).

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    More about this item

    Keywords

    Risk perceptions; Expectations; COVID-19; Political partisanship; Polarization; Pandemics; Social distancing and compliance;
    All these keywords.

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • I1 - Health, Education, and Welfare - - Health
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State
    • L82 - Industrial Organization - - Industry Studies: Services - - - Entertainment; Media

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