Executive approval and accountability: the impact of global shocks in less developed democracies

This article offers an original theory which elucidates how voters in less developed settings evaluate macroeconomic performance and fiscal policies. We argue that voters face a critical challenge in the attribution of responsibility in an era of global market integration. We then present a theory where the complex interaction between the economy, government policies, and executive approval is understood by considering that there are substantial differences between ordinary times, and periods in which large-scale, global exogenous shocks hit the domestic economy. In ordinary times, voters evaluate incumbents for economic performance and policy. During large-scale exogenous shocks, however, voters continue to assess incumbent competence, but the task of making performance and policy-based evaluations is much harder as it depends on a more sophisticated understanding of the source of the shock, and what types of fiscal and monetary responses might be more appropriate to mitigate the effect of the crisis. We test our assumptions and theoretical expectations with monthly data for Brazil from 1997 to 2022.