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The Comovement of Voter Preferences: Insights from U.S. Presidential Election Prediction Markets Beyond Polls

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  • Mikhail Chernov
  • Vadim Elenev
  • Dongho Song

Abstract

We propose a novel time-series econometric framework to forecast U.S. Presidential election outcomes in real time by combining polling data, economic fundamentals, and political prediction market prices. Our model estimates the joint dynamics of voter preferences across states. Applying our approach to the 2024 Presidential Election, we find a two-factor structure driving the vast majority of the variation in voter preferences. We identify electorally similar state clusters without relying on historical data or demographic models of voter behavior. Our simulations quantify the correlations between state-level election outcomes. Failing to take the correlations into account can bias the forecasted win probability for a given candidate by more than 10 percentage points. We find Pennsylvania to be the most pivotal state in the 2024 election. Our results provide insights for election observers, candidates, and traders.

Suggested Citation

  • Mikhail Chernov & Vadim Elenev & Dongho Song, 2025. "The Comovement of Voter Preferences: Insights from U.S. Presidential Election Prediction Markets Beyond Polls," NBER Working Papers 33339, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:33339
    Note: AP PE POL
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    More about this item

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • P0 - Political Economy and Comparative Economic Systems - - General

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