2PP AGGREGATE (TUESDAY 27 AUGUST): 52.4 TO COALITION (+0.4 SINCE LAST WEEK)
INDIVIDUAL SEAT BETTING: Labor favourites in 59.5 seats (-1.5, Eden-Monaro, Brand becomes tossup)
SEAT TOTAL MARKET: Labor 61 seats (-2) (This figure is probably slightly skewed by longshot bias.)
This is week nine in a regular weekly series in the leadup to the federal election.Week eight was and through it you can click back to the previous weeks.Or just click the "betting" label at the bottom.As stated before, the aim of this exercise is not to claim that seat betting markets have predictive value, but to test whether they do, and to see which of the markets and the aggregated polls see the ultimate outcome of the election first.
THIS WEEK'S POLLS
It was a relatively quiet weekend for polling compared to the previous week's six-poll deluge.Nielsen and Newspoll both returned 53-47 to the Coalition.Roy Morgan returned 52.5-47.5 by last-election preferences.Essential returned a second consecutive 50-50, but this one was off the back of a two-point fall in the ALP primary and a three-point rise in the Greens primary. My aggregate has gone to 52.4.At the moment, it has one of the more benign readings for Labor doing the rounds - aggregates that benchmark solely off the last election are about a point worse, and those that handle sample size issues in a more sophisticated way, or weight heavily for accuracy of particular polls, are also showing slightly worse readings for Labor.A catastrophic decline in Labor's polling this week was expected in some quarters but hasn't happened - instead the picture is one of the dramatic recovery steadily fading and chances gradually slipping away.All kinds of tactical explanations can be attached to that but I don't think we need any.This is what polling bounces usually do.
It's really hard to know what to do with Essential in the current circumstances.The strange behaviour of the poll has been framed by some as a phone-polls-vs-online-polls issue, but Morgan Multi-Mode, which uses an online panel as one of its sources, has displayed a similar pattern to the phone pollsters (just with the extra point or two for Labor thrown in).Essential hasn't displayed a consistent house effect relative to the other pollsters, nor the same patterns in a muted or delayed form; rather, it seems to be polling for a different election altogether.At Mark the Ballot, Essential has been for its strange behaviour.
Here, I've decided I should leave Essential in (since for all we know, there's always the chance it is right and the others are somehow wrong) but that during the election period it should carry a sightly lesser weighting than normal because of the increased sample sizes of Newspoll and Nielsen.Concerning the overall online-vs live dial-vs robopoll issue, it was notable that online surveys did rather well in the .However, when the party biases of the groups of pollsters using the different methods are averaged out, they didn't come to a very large difference - and US pollsters had the added challenge of identifying who will bother voting.It's most likely in Australia that house effects in the campaign will have more to do with individual pollsters than with their primary surveying method, and that attempts to generalise across kinds of polling when we only have a few examples of each will be meaningless.
The weekend's polls contained quite a range of leader ratings.Newspoll finally killed off my prediction (initially given an at most 20% chance of failing) that Tony Abbott wouldn't get his netsat into negative single figures by the election; he's reached the heights of -7, and now has the outright second-highest trough-to-peak netsat gain (29 points) for an Opposition Leader since the late 1960s.He may even yet reach a positive rating by the election.Abbott's current satisfaction ratings (42-49) are exactly where they were in July 2011; they were last better at the start of May that year.Essential, not surprisingly given its generous 2PP, has Rudd with a -4 netsat while Abbott languishes where he was in May this year on -15.Nielsen splits the difference with Rudd (down nine points in two weeks to -8) and Abbott (down one point to the same amount) tied.As far as people who answer the telephone are concerned, Tony Abbott's long-term unpopularity is no longer an issue.He's just another politician.The online view might still be a bit critical.
Most of the seat polls from late last week were covered in the updates to last week's roundup.There is one that was not included so far, a 50-50 in Hindmarsh (SA) via automated Galaxy.We also saw a Tasmania-wide ReachTEL showing a swing of (link goes to my lengthy analysis) and projecting that Labor would currently lose Bass, Braddon and 12.3%-margin Lyons, with 10.8%-margin Franklin on the wire.These swings are much greater than the six or so percent swing implied by Morgan's state samples and there is some need for an established phone pollster to resolve the difference between the two; if only to deliver me from a fifty-fifty chance of getting Lyons wrong.The complex seat-poll vs national-poll debate continues to rage; I think I'll wait until it is nourished with more data later this week before having another go at it.
Lastly, we've had the perennial problem in the last week of Newspoll aggregates of surveys conducted over several weeks being in the media as if they were fresh polling. They are not, and the rosy picture painted by such reports for Labor should be ignored.
GHOST OF THE WEEK: 1996
What we've seen this week so far in the national polls is nothing startling (except for those who didn't cease being startled by Essential doing odd things long ago.)The slight worsening of Labor's position has neither matched the script of a recovery to a very close fight (a la 1993) nor the script of a continued slide into catastrophe (like 1975).With last week's visiting ghosts looking less likely this week, but with seat-polling menaces lurking everywhere, a reprise of 1996 is another mooted scenario.The Coalition could finish up in the mid-53% range, but with Labor losing significantly more than the fourteen seats implied by the pendulum, and finishing up on about 50 seats.
The curious thing about 1996 is that although Labor's defeat seemed heavy in seat terms for the national 2PP, it was more or less exactly "by the pendulum".Labor went into the election holding 29 seats on less than the eventual swing, and lost 21 of those to the Coalition and 1 to an independent.Seven were saved and one seat Labor had lost at a by-election was recovered from the Coalition.On the other hand, seven seats above the swing line were lost to the Coalition, and one to an independent.So Labor's net seat losses at that election were almost exactly what would have been expected based on the swing, as a result of a concentration of Labor seats on margins below 5%.If we get a result like, for instance, 97-50 off a 53.6:46.4 2PP this time around, it will be because Labor has suffered much worse in seat terms than such a 2PP result predicts based on the current distribution of seat swings.Generally in the past, predictions that one party will do much better or worse than the pendulum expectation for a given swing don't have a good predictive record.
SOME OTHER GHOSTS CLEANED UP
Something I should have done long ago is clean up my Newspoll 2PP archive to correct for Newspoll having allocated 2PP results using respondent-allocated preferences in 2004 (Peter Brent covered this ).When these are converted (somewhat roughly) to 2PPs by the modern method, it makes quite a difference.The value of the switch to Latham now peaks (in rolling average 2PP terms) at about 4.4 points, with Labor's best run having been a run of 53-54-53 in March-April 2004.For the last five months of the 2004 election, Labor under Latham were never really ahead by much.They started the campaign very marginally ahead, were back to level by the two-week-out point, and then fell behind in the last two polls.Latham was never as far ahead as those watching the Newspoll 2PP thought, and this explains some of the discrepancy between Latham's perceived leads in Newspoll and him trailing for most of that year in betting odds and "who do you think will win?" type questions.While the discrepancy between polling at this stage and the final result in 2004 was still a large one, it was more like 2.7 points than four points.
I've also unearthed some reporting about pollsters other than Morgan for 1980, that reveals that Morgan's final poll that showed Labor well ahead was a bit of an outlier; other polls in the field at the time had it more or less level (which is where it ended up).An average at the time would probably have had Fraser's government behind, but not by any great margin.Say, 49:51, or maybe a little bit worse.
MODELLING LABOR'S CHANCES USING PAST DATA
Last week I discussed how a few simple linear regressions could be used to estimate Labor as having a 29% chance of breaking 50-50 based on the record of past governments, or a 20% chance based on the past record of the parties (I prefer the latter method).However that was if one ignored the Rudd leadership bounce issue, which I argued one shouldn't do.I came up with a past-data based estimate of 12% for Labor's chances. Because of the 2004 preferences issue mentioned above, those models were a little more optimistic for Labor than they should have been, but not much.About 10% was probably a better estimate then.
This week, ignoring the Rudd-return bounce issue, modelling based on the fate of the government at the time gives Labor an expected 48.8% 2PP with a 22% chance of winning.Modelling based on fate by party (which is more predictive and in my view better) gives Labor an expected 48.3% 2PP with a 13% chance of winning using just Newspoll data, or 48.5% and 17% if I use my current aggregate and patterns from past Newspolls.
There is a third way of modelling, which is modelling based on the fate of the underdog.However, from a data set of nine elections, which way you assign "underdog" status for 2004 makes an immense difference to the outcome of the model. If you deem Howard to have been the underdog then the model is more predictive than modelling by government or party, but if you deem Latham to have been the underdog then the model is almost totally destroyed.The actual situation is that the polling at this stage showed the Coalition ahead on primaries with the real 2PP more or less tied, but people who placed too much faith in Newspoll's 2PP would have thought Latham was winning.The public generally did not believe Latham was going to win and the punters did not believe Latham was going to win.The underdog effect is supposed to result from people getting behind the side they think is losing, not the side that is claimed to be losing on some (at the time new-fangled) indicator of polling results that people evidently placed little trust in.A similar issue applies to 1998.No version of the underdog model projects a Labor win from the current position (the best it does is about a 30% chance) but I think the whole question of who was the underdog at this stage in some past elections is too poorly defined to make it worth persisting with.
There is next the question of what to do with the Rudd bounce deflation issue.Is Labor's polling still being dragged down by the washing-out from the system of the Rudd-return honeymoon effect? This week's polls are consistent with three possibilities: that the Rudd bounce has stopped deflating and Labor just had a randomly bad week of polling, that the Rudd bounce is still deflating but the pace has slowed, and that the Rudd bounce is still deflating at a steep linear rate but Labor had a randomly good week of polling given that fact.The worst case projects Labor downwards to around 46% (give or take the usual point or two) with about a 1% chance of winning, but it shouldn't carry as much weight as it did last week, as there is some evidence the bounce deflation might have slowed.
All up my back-of-envelope scribbling here based on the past record of the two parties and considering the Rudd bounce issue gives Labor an expected average 47.4% 2PP (about what it is now), with a victory chance of only 9%.Even if someone wants to argue whether there should be corrections made for the Rudd bounce issue or not, or prefers to model by the fates of governments rather than parties, it all doesn't make a lot of difference.The central point is that past data imply Labor's victory chance is still real but fading week by week, and imply that it is slim. My rough 61-seat projection looks optimistic at the moment but I'm going to construct a multi-source seat data model after next week's national polls to see if it needs to be reduced.
My assessment here is about as bad for Labor as the headline betting, so I obviously don't agree that $9 for Labor in a two-horse race at 52.5-ish two weeks out is as silly as .The fact is, nobody has yet retained office from this kind of position this close to the day - not at national level and probably not at state level either.The governments that came from behind during the campaign to win in 1980, 1993 and 1998 (the last even without winning the 2PP, which Labor probably needs to do) were not this far behind at this point, while Howard had already equalised in 2004.A win from here would be even more surprising - a good deal more surprising - than 1993.If the betting headline rates are really displaying a run on themselves fuelled by belief that markets are predictive (and I think this may very well be true), then that might be just cancelling out the longshot bias that in the past has seen only one of nine betting underdogs win, although the odds implied that on average probably three of them should have done so.
Any model based on past polling data should be treated with some degree of caution.The number of elections for which we have rich polling data from the campaign period is small. The challenges facing phone pollsters now are very different to those that existed in 1987, and there is a belief that accurate polling by landline, or even by telephone at all, will become harder and harder and eventually become obsolete.But this is not an issue that should be expected to suddenly bite hard and do two or three points damage out of nowhere at a single election, and it wasn't even really nibbling in 2010.
SEAT BETTING PICTURE
This week the Centrebet/Sportingbet exact seats market has seat totals from 87 to 90 seats as joint favourites (this would probably leave Labor with 58 to 61).The correct election result market, which may be slightly skewed by longshot bias (but not very since it only gives Labor a 10% chance of winning outright), implies 61 Labor seats.
Here is the individual seat graphic:
The colour-coding again:
Medium blue: A seat in which the Coalition is favoured in all betting markets.
Pale blue: (none this week) Coalition favoured in some markets, level in others.
Grey:All markets tied or both parties ahead in some markets and behind in others.
Orange: Labor favoured in some markets, level in others.
White: Labor favoured in all markets.
There are four colour changes this week.The famous "litmus seat" Eden-Monaro has gone alkaline for the first time since just after Rudd became PM again.There is a split market in Brand, with Labor favoured on one exchange and the Coalition on two.And two Labor seats, Kingsford-Smith and Lyons, are now tied on one market.(In Lyons there currently exists a small arbitrage between Centrebet and Luxbet.) I have simply tacked Lyons on the end of the graphic above without including all the Labor-held seats in between.
Here's the trend tracker for seats that have changed:
The close seat analysis is very unpleasant for Labor this week.Despite gaining a seat from Labor this week, the Coalition is now favoured in only FOUR (-3) seats in which Labor is inside $3 on some market.They are the Labor seats of Eden-Monaro and Moreton and the Coalition seats of Brisbane and Bonner.The mostly familiar list of expected Coalition gains - Corangamite, Deakin, LaTrobe, Dobell, Greenway, Banks, Reid, Lindsay, Robertson, Braddon and Bass - are all outside the close-seat window.(Indi, where Sophie Mirabella is under a plausible level of threat from independent Cathy McGowan, is sniffing around the edges of the close-seat list having come down to around $3.50 this week.)
For Labor, the vulnerable species list just keeps growing.Despite two close seats leaving Labor's list this week, the ALP still has SEVENTEEN (+3) seats that the market is edgy about.New appearances on the list this week include Adelaide and (...drumroll...) Griffith!Therefore, the seat-betting markets are likely to be expecting a somewhat worse outcome for Labor than the 59.5 seats in which Labor leads.The markets don't seem to think much of the idea that most of these will go together (otherwise 101+ Coalition seats should be shorter than $6) so it's fair to assume there's at least a moderate degree of independence in the concern levels for various Labor seats around the country.
A list of likely and possible seat gains and losses apparently culled from party inside polling gossip appeared in The Australian today, with a close overlay with the seat betting favourites lists.Petrie and Capricornia appeared as losses for Labor and Brisbane for the Coalition, while Deakin and Eden-Monaro were not on the main list of strongly likely Labor losses. Lyons was flagged as a possible loss.
Updates to this article are very likely to follow through the week; next week I will have a final volume in this series, and a comprehensive projection which may well be comprehensively wrong.On election night I will almost certainly be doing live coverage of the election somewhere but my modelling currently shows a 75% probability it won't be here.If it isn't here, there'll be a link to it posted prominently here on the night.Post-coverage will be posted here.
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