The election’s effect on the economy? Doughnut sales are probably safe

New York Times News Service

The coming election will give the United States new lawmakers and a new president. But what does it mean for fast food, leisure cruises and bulldozers?

As the nation’s bitter, bizarre campaign season builds to its November conclusion, companies across a range of industries are using the election as a data point — sometimes as an excuse — to explain what’s happening in their business.

Executives at Jack in the Box said uncertainty over the election could be affecting consumers’ willingness to buy Jumbo Jacks and cheeseburgers. Commercial real estate brokers said the election was causing businesses to hold off on new office leases. Auto dealers said the results could determine how many people buy cars.

From banking to oil to pharmaceutical companies to real estate agents and even cruise ship operators, everyone seems to think wariness ahead of the election is affecting their businesses. Sometimes for the better, mostly for the worse.

Economists aren’t so sure.

“It’s essentially untrackable and unknowable,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics.

The problem with blaming unease over the election for disappointing business results is that there is faint evidence for it in the broader data. Businesses continue to hire at a decent clip, new home sales are steady and measures of consumer confidence are down but not by much. And on Monday, the Commerce Department reported that consumer spending was up 0.5 percent in September, a very healthy gain.

That is not to say that government policy doesn’t matter over the longer run — Hillary Clinton and Donald Trump are offering starkly contrasting prescriptions for improving the economy — just that worries about the outcome are probably not a big factor affecting coffee and doughnut sales these days.

Various research papers suggest that elections and policy decisions can weigh heavily on businesses thinking. But for the most part, it seems limited to large-scale investment decisions that take years to show up in the data and even then are hard to tease out from all the other things going on.

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