A voter at a crossroads, symbolizing the choice between economic needs and political loyalty.

Will Your Wallet Decide the Next Election? How Economic Struggles Sway Voters

Lena Kashyap in Politics & Policy September 2025 • 4 min read.

"Dive into the groundbreaking research revealing how inflation and personal financial woes are rewriting the rules of political loyalty."

In an era defined by economic uncertainty, the financial pressures felt by individuals are increasingly shaping the political landscape. Inflation, rising costs of living, and personal economic struggles are no longer just kitchen-table concerns; they're powerful forces influencing voter behavior and potentially deciding election outcomes. This article explores how these economic factors impact voting decisions, drawing on recent research to understand the shifting dynamics of voter loyalty.

Major news outlets, including Fox News, CNN, and ABC News, have consistently reported on the widespread impact of inflation, highlighting how it has affected Americans' grocery purchases and overall financial well-being. This economic strain is not occurring in a vacuum. It's influencing how people engage with politics and who they choose to support at the ballot box. Understanding this connection is crucial for anyone seeking to grasp the current political climate.

Economic voting theory posits that voters' choices are heavily influenced by the economic conditions they experience. This article delves into this theory, examining how personal economic struggles, measured through a novel Inflation Behavior Index, can override traditional party loyalty. We'll explore the nuances of pocketbook voting (how personal finances affect decisions) and sociotropic voting (how perceptions of the national economy play a role), providing a comprehensive look at the economic factors driving voter behavior.

The Inflation Behavior Index: Quantifying Economic Hardship

To better understand the impact of economic struggles on voting behavior, a new tool has been developed: the Inflation Behavior Index (IBR). This index captures the cumulative economic pressures individuals face due to inflation, measuring how they've adapted their financial behaviors in response to rising costs.

The IBR is constructed from four key indicators, reflecting common financial adjustments people make when facing economic hardship:

Borrowing money to pay bills
Cutting down on everyday spending
Canceling or postponing major purchases
Dipping into savings

Each of these behaviors is assigned a value, and the resulting index provides a comprehensive measure of an individual's economic strain. By quantifying these experiences, researchers can more effectively analyze how economic hardship translates into political action.

Implications and Future Directions

This research underscores the profound impact of economic factors on voter behavior, particularly the role of personal economic struggles in overriding party loyalty. As economic uncertainty continues to be a defining feature of our times, understanding these dynamics will be crucial for political strategists, policymakers, and anyone seeking to engage with the electorate effectively. Further research, particularly with more nuanced data collection, will undoubtedly shed even more light on the complex interplay between economics and political decision-making.

About this Article -

This article was crafted using a human-AI hybrid and collaborative approach. AI assisted our team with initial drafting, research insights, identifying key questions, and image generation. Our human editors guided topic selection, defined the angle, structured the content, ensured factual accuracy and relevance, refined the tone, and conducted thorough editing to deliver helpful, high-quality information.See our About page for more information.

This article is based on research published under:

DOI-LINK: https://doi.org/10.48550/arXiv.2408.05223,

Title: Economic Struggles And Inflation: How Does That Affect Voting Decision?

Subject: econ.gn cs.et q-fin.ec

Authors: Muhammad Hassan Bin Afzal

Published: 27-07-2024

Everything You Need To Know

How does inflation affect voting decisions?

Inflation significantly impacts voting decisions by creating economic hardships. These hardships, quantified by the Inflation Behavior Index (IBR), can override traditional party loyalty. When individuals experience financial strain due to rising costs, they may vote based on economic concerns rather than party affiliation. Major news outlets have reported on the widespread impact of inflation, highlighting its effect on Americans' financial well-being and how it subsequently shapes their political engagement.

What is the Inflation Behavior Index (IBR) and how is it used?

The Inflation Behavior Index (IBR) is a tool designed to quantify the economic pressures individuals face due to inflation. It measures how people adapt their financial behaviors in response to rising costs. The IBR is constructed from four key indicators: borrowing money to pay bills, cutting down on everyday spending, canceling or postponing major purchases, and dipping into savings. By assigning values to each of these behaviors, the IBR provides a comprehensive measure of an individual's economic strain, allowing researchers to analyze how economic hardship influences political action.

What are the key components used to calculate the Inflation Behavior Index (IBR)?

The Inflation Behavior Index (IBR) is calculated using four key indicators that reflect how individuals adjust their financial behaviors in response to rising costs. These components include: borrowing money to pay bills, cutting down on everyday spending, canceling or postponing major purchases, and dipping into savings. Each of these actions is assigned a value, contributing to the overall measure of an individual's economic strain. These indicators provide a tangible way to quantify the economic pressures people experience and their impact on voting behavior.

How do personal economic struggles influence voting behavior, according to economic voting theory?

According to economic voting theory, voters' choices are heavily influenced by the economic conditions they experience. Personal economic struggles, as measured by the Inflation Behavior Index (IBR), can override traditional party loyalty. This means that when individuals face economic hardship, such as rising costs and financial strain, they are more likely to vote based on their personal economic concerns (pocketbook voting) rather than aligning with their usual political party. Sociotropic voting, which involves how people perceive the national economy, also plays a role, but the direct experience of economic struggles, as captured by the IBR, is a significant factor in shifting voter behavior.

Why is understanding the relationship between economics and voting behavior important?

Understanding the relationship between economics and voting behavior is crucial because economic factors have a profound impact on how people vote, particularly in times of economic uncertainty. The research highlights the role of personal economic struggles in overriding party loyalty. As economic conditions continue to evolve, grasping this dynamic is essential for political strategists, policymakers, and anyone seeking to effectively engage with the electorate. Knowing how factors like the Inflation Behavior Index (IBR) influence voters' choices helps in predicting election outcomes and understanding the shifting political landscape, and how economic issues can shape voter's decisions.