Business, Government & the International Economy

- 2023
- Working Paper
Detecting Structural Breaks in Inflation Trends: A High-Frequency Approach

By: Alberto Cavallo and Gaston Garcia Zavaleta

We combine standard structural-break methods with high-frequency data to identify shifts in inflation trends. We use this approach to study the inflation dynamics of 25 countries from January 2022 to April 2023 and find evidence of a broad-based slowdown in about half of them, including the US. The high-frequency and depth of the data allow us to detect the breaks within a few weeks for a large number of disaggregated sectors, providing an advantage over CPI data for real-time analysis. We apply single and multiple-break strategies; allowing for multiple breaks helps us identify relevant breaks in some sectors but does not significantly change our main results.
- 2023
- Working Paper
Detecting Structural Breaks in Inflation Trends: A High-Frequency Approach

By: Alberto Cavallo and Gaston Garcia Zavaleta

We combine standard structural-break methods with high-frequency data to identify shifts in inflation trends. We use this approach to study the inflation dynamics of 25 countries from January 2022 to April 2023 and find evidence of a broad-based slowdown in about half of them, including the US. The high-frequency and depth of the data allow us to...
- May 2023
- Article
How Do Campaigns Shape Vote Choice? Multi-Country Evidence from 62 Elections and 56 TV Debates

By: Caroline Le Pennec and Vincent Pons

We use two-round survey data from 62 elections in 10 countries since 1952 to study the formation of vote choice, beliefs, and policy preferences and assess how televised debates contribute to this process. Our data include 253,000 observations. We compare the consistency between vote intention and vote choice of respondents surveyed at different points before, and then again after, the election, and show that 17% to 29% of voters make up their mind during the final two months of campaigns. Changes in vote choice are concomitant to shifts in issues voters find most important and in beliefs about candidates, and they generate sizable swings in vote shares. In contrast, policy preferences remain remarkably stable throughout the campaign. Finally, we use an event study to estimate the impact of TV debates, in which candidates themselves communicate with voters, and of shocks such as natural and technological disasters which, by contrast, occur independently from the campaign. We do not find any effect of either type of event on vote choice formation, suggesting that information received throughout the campaign from other sources such as the media, political activists, and other citizens is more impactful.
- May 2023
- Article
How Do Campaigns Shape Vote Choice? Multi-Country Evidence from 62 Elections and 56 TV Debates

By: Caroline Le Pennec and Vincent Pons

We use two-round survey data from 62 elections in 10 countries since 1952 to study the formation of vote choice, beliefs, and policy preferences and assess how televised debates contribute to this process. Our data include 253,000 observations. We compare the consistency between vote intention and vote choice of respondents surveyed at different...
- March 2023
- Case
Thailand: Red Shirts, Yellow Shirts, and a Green Revolution

By: Jaya Wen
- March 2023
- Case
Thailand: Red Shirts, Yellow Shirts, and a Green Revolution

By: Jaya Wen

About the Unit

The BGIE Unit conducts research on, and teaches about, the economic, political, social, and legal environment in which business operates. The Unit includes scholars trained in economics, political science, and history; in its work, it draws on perspectives from all three of these disciplines.

The following demonstrates one way of classifying the approaches the Unit takes to learning and teaching.

The Unit examines the “rules” and policies established by government and other non-business institutions that affect business in the United States.
The Unit turns to history to understand the origins of today’s business environment as well as some of the alternatives that have emerged from time to time.
The Unit examines other countries’ business environments and their historical development.
The BGIE group is deeply interested in the impact of globalization and the way rules are emerging to govern international economic transactions as globalization proceeds.

Recent Publications

TikTok and National Security: Investment in an Age of Data Sovereignty?

By: Jeremy Friedman

May 2023 |
Teaching Note |
Faculty Research

Teaching Note for HBS Case No. 722-020.

Citation

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Detecting Structural Breaks in Inflation Trends: A High-Frequency Approach

By: Alberto Cavallo and Gaston Garcia Zavaleta

2023 |
Working Paper |
Faculty Research

We combine standard structural-break methods with high-frequency data to identify shifts in inflation trends. We use this approach to study the inflation dynamics of 25 countries from January 2022 to April 2023 and find evidence of a broad-based slowdown in about half of them, including the US. The high-frequency and depth of the data allow us to detect the breaks within a few weeks for a large number of disaggregated sectors, providing an advantage over CPI data for real-time analysis. We apply single and multiple-break strategies; allowing for multiple breaks helps us identify relevant breaks in some sectors but does not significantly change our main results.

Keywords: Inflation and Deflation; Global Range; Economic Slowdown and Stagnation; Analysis; Price

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How Do Campaigns Shape Vote Choice? Multi-Country Evidence from 62 Elections and 56 TV Debates

By: Caroline Le Pennec and Vincent Pons

May 2023 |
Article |
Quarterly Journal of Economics

We use two-round survey data from 62 elections in 10 countries since 1952 to study the formation of vote choice, beliefs, and policy preferences and assess how televised debates contribute to this process. Our data include 253,000 observations. We compare the consistency between vote intention and vote choice of respondents surveyed at different points before, and then again after, the election, and show that 17% to 29% of voters make up their mind during the final two months of campaigns. Changes in vote choice are concomitant to shifts in issues voters find most important and in beliefs about candidates, and they generate sizable swings in vote shares. In contrast, policy preferences remain remarkably stable throughout the campaign. Finally, we use an event study to estimate the impact of TV debates, in which candidates themselves communicate with voters, and of shocks such as natural and technological disasters which, by contrast, occur independently from the campaign. We do not find any effect of either type of event on vote choice formation, suggesting that information received throughout the campaign from other sources such as the media, political activists, and other citizens is more impactful.

Keywords: Political Debates; TV Debates; Voting; Political Elections; Decision Choices and Conditions

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