How undefined is 2018’s presidential election result?

 We built an electoral undefinition index and verified that the current distribution of voting intentions makes
the 2018 election, thus far, the most uncertain since the end of the military government.
 Most of the uncertainty about the 2018 election comes from the number of voters who have not chosen a
candidate (blank, null and undecided), but the dispersion of voting intentions among pre-candidates also
contributes to the lack of definition about the election results.
Only a few months ahead of the 2018 election, we see a level of uncertainty in voting intention polls that seems
more intense than in past elections. When we evaluate the number of candidates with similar levels of voting
intentions, there is a degree of fragmentation that alludes to the electoral cycle of 1989, which was also marked by
high uncertainty, in the first direct elections after the end of the military regime.
In order to measure this perception about the level of uncertainty in 2018 elections, we built an electoral undefinition
index that allows to directly compare the current cycle with the previous ones. At a first glance, the uncertainty can
be measured by the percentage of poll respondents who say that they have no candidate, or that they intend to cast
blank or null votes. However, this percentage measures only part of the uncertainty, given that the level of
competition among candidates also influences the degree of uncertainty as to the outcome of the election. In a
practical example: assuming 40% of blank/null/undecided voters and the remaining 60% distributed among the top
four candidates, a scenario where each candidate holds 15% of voting intentions would be much more uncertain
than a case where the front runner has 50% and the other three candidates divide the remaining 10%.
In order to aggregate the importance of the dispersion of votes among different candidates to the information that is
already provided by the number of blank/null/undecided voters, we sought inspiration in the literature on economic
competition and concentration. In this field of economics, it is common practice to measure the concentration of a
market by using the Herfindahl-Hirschman (HH) index, a measure of companies’ size in relation to the market as a
whole. More specifically, the index consists of the sum of the squares of the percentage participations of each of the
companies operating in a given market, as in the equation below:

Fuente: Itaú

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Macroeconomía