Abstract

BENTON, Allyson Lucinda. ¿QUIÉN ESTÁ PREOCUPADO POR LÓPEZ OBRADOR? Las respuestas del mercado a las tendencias electorales durante la campaña presidencial mexicana del 2006. colomb.int. [online]. 2006, n.64, pp.68-95. ISSN 0121-5612.

This article addresses a key issue during the course of Mexicos 2006 presidential campaign: How did markets react to changes in support for the left-leaning Andrés Manuel López Obrador (PRD)? To answer this question, I develop a series of alternative arguments for how investors would respond changes in PRD support during the campaign. I evaluate the arguments using a times series GARCH model.The results show that changes in the levels of support for the candidate did not affect market returns but they did affect market volatility. Increased electoral uncertainty, as margins narrowed, raised market volatility, while increasing electoral certainty, regardless of whether rises in support were for López Obrador or the market-friendly Felipe Calderón (PAN), reduced it. This finding reveals that investors may have accepted the prospect of a López Obrador presidency ahead of the election but not the possible post-election social and political instability associated with a tight race.

Keywords : Mexico; presidential elections; public opinion; financial markets; presidential campaigns.

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