It could be said that after hits and misses on both the US and UK elections, public faith in the accuracy of opinion polls has come to be severely tested. This was strikingly evident after the 2016 US Presidential election when poll favourite Hillary Clinton was trounced by Donald Trump.
As scepticism grows over opinion polls, many commentators now consider that it might be worth paying some attention to bookies’ betting odds in addition to opinion polls. This becomes more relevant at times of political volatility.
CAN BETTING ODDS MAKE RELIABLE POLITICAL FORECASTS?
Inevitably in their forecasts, bookies incorporate multiple sources of information, including opinion polls. These graphs (1a and 1b) show that both bookies and pollsters correctly forecast that Joe Biden would win the US election in 2020.
Were the bookies’ forecasts more definitive than the forecasts of opinion polls?
BOOKIES’ FORECAST FOR THE 2024 US PRESIDENTIAL ELECTIONS?
We have been broadly tracking bookies’ forecasts over the last two years – Figure 2a – on who are the top five candidates for US President. Trump is not only the clear frontrunner, but also the biggest gainer since the last election. Trump’s chance of winning has risen consistently from the December 2020 low of 13%, a poor third favourite, to between 25%-27%, a remarkable doubling, which makes him the absolute and unquestionably clear favourite today. Trump is now an impressive 10% ahead of his nearest rivals, Biden and De Santis.
Perhaps the big revelation in the last six months has been the sudden and sharp upswing in De Santis’ chances (Figure 2b) – his odds have more than doubled in the last six months from 7% to over 15% currently. This week marks the first time that Trump’s nearest rival is no longer a Democrat, but another Republican. De Santis’ rise has been synchronous with the decline of President Biden – whose odds are now marginally below De Santis’: ominous signs for the Democratic party.
Indians, not too long ago, hoped that the next US Presidential election would be between two candidates of Indian origin: Kamala Harris versus Nikki Haley! But within the last 18 months (Figure 2c), Kamala Harris crashed from being the No 1 favourite (in December 2021) with a 20% chance to a 5% chance today, according to the bookies’ betting odds. This places Harris only a little above Nikki Haley, who is at a 4% chance of winning. But analysts say there are signs of an uptick in Kamala Harris’ ratings – a bounce-back is possible for “a week is a long time in politics”.
UK ADDENDUM: THE DECLINE AND DESTRUCTION OF RISHI SUNAK
While the two Indian-origin candidates in the US may bounce back, in the UK, the crash is even more devastating (Figure 3).
It was only three months ago that Rishi Sunak was the absolute hot favourite to be the next British Prime Minister with a 40% chance (the second favourite, Liz Truss trailed Sunak at a distant 18%). But Rishi Sunak’s chances have crashed from 40% to 5% today, according to the bookies. It may need much longer than a week for a Sunak bounce-back. It’s still not clear what the details are of the political intrigue that engulfed him – many analysts say his strong rating, making him the closest rival to Boris Johnson was, in fact, his biggest vulnerability.