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Thursday, October 4, 2012

Election Markets: Pre vs. Post Debate


Romney Shows Positive Movement in Key Battlegrounds

Political pundits agree widely that Mitt Romney outperformed President Obama in last night’s presidential debate. Flash polls and focus groups agreed with that assessment. In fact, the margin of people believing that Romney had bested the President was quite large.

It remains to see whether last night’s debate had any effect on voter intentions and moved the polls nationally and in key battleground states. It will be a number of days before we see polls that fully encompass the post-debate timeframe.

Further complicating any analysis is the Bureau of Labor Statistics’ (BLS) release of the September employment situation report on Friday at 8:30 a.m. Depending on the news, the report may serve to accelerate movement towards Romney if the report is viewed as “poor” or serve to stem any tide if the report is viewed as a “good” report.

InTrade markets suggest that last night’s debate did indeed move the race marginally in Romney’s favor. Remember, this is without the benefit of any post-debate horserace polling.

Since the debate, Romney’s position has improved in both the micro and macro versions of the ElectionMarkets’ model.

While Obama retains a solid advantage at this point in both models, the one day shift is significant. As intriguing as the topline shift is, the movement in selected battleground states is telling. The following table shows the change in Romney’s pre-debate and post-debate probability of victory in selected states.

Note that the President still maintains an advantage in all of these states except North Carolina, but the narrowing of the gap will be significant if the trend continues.