The COVID effect: an empirical analysis of the pandemic and the 2020 U.S. presidential election

The impact of the COVID pandemic on the 2020 election outcome is analyzed using Iowa Electronic Market data, measures of socially and economically driven market volatility, a measure of COVID severity, and selected election-related events. Building on research regarding two previous U.S. presidential elections, we find that the pandemic helped the incumbent in two ways. The largest impact supporting the incumbent came from the apparent medical severity. A secondary impact came from social and economic volatility with the surprising finding that both risks helped the incumbent relative to the challenger. However, these impacts were not adequate to overcome the relatively large advantage of the challenger.