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Traders work during the opening bell at the New York Stock Exchange this month. Photo: Johannes Eisele/AFP via Getty Images

The market can influence how people who own shares vote in U.S. presidential elections, a new study by Rice University and University of Pittsburgh examining the electoral implications of stock fluctuations finds.

The big picture: The study compares electoral preferences with levels of dividend income. It finds the effect of recent stock returns on votes for the incumbent party is stronger in counties with greater market participation. And it suggests that if the market had rebounded instead of falling in 2008, Republican presidential candidate John McCain may have won the states of Florida, Indiana, North Carolina, and Ohio.

What they're saying: Alan Crane, a finance professor at Rice, told Bloomberg Sunday that if you’ve got a large amount of money invested in shares during a rising stock market "you’re going to support that incumbent party, because that’s good for you personally. "You have an opportunity for politicians to cater through this particular channel," he said.

Yes, but: The study does not definitively state that the market has a direct impact on election outcomes. As Bloomberg notes, "incumbent Democrats were booted out in 2000 after one of the biggest rallies ever."

Read the study:

Go deeper

6 hours ago - Politics & Policy

Rahm Emanuel floated for Transportation secretary

Rahm Emanuel. Photo: Joshua Lott for The Washington Post via Getty Images

President-elect Biden is strongly considering Rahm Emanuel to run the Department of Transportation, weighing the former Chicago mayor’s experience on infrastructure spending against concerns from progressives over his policing record.

Why it matters: The DOT could effectively become the new Commerce Department, as infrastructure spending, smart cities construction and the rollout of drone-delivery programs take on increasing economic weight.

6 hours ago - Politics & Policy

Biden turns to experienced hands for White House economic team

Illustration: Sarah Grillo/Axios

Joe Biden plans to announce Cecilia Rouse and Brian Deese as part of his economic team and Neera Tanden to head the Office of Management and Budget, sources tell Axios.

Why it matters: These are experienced hands. Unveiling a diverse group of advisers also may draw attention away from a selection of Deese to run the National Economic Council. Some progressives have criticized his work at BlackRock, the world's largest asset management firm.

Biden taps former Obama communications director for press secretary

Photo: Mark Makela/Getty Images

Jen Psaki, who previously served as Obama's communications director, will serve as President-elect Joe Biden's press secretary, the transition team announced Sunday.

The big picture: All of the top aides in Biden's communication staff will be women, per the Washington Post, which first reported Psaki's appointment.

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