House effect. The Polish presidential election

House effect. The Polish presidential election

Not Europe again?  I’m afraid so.  Fortunately, this time it’s for an election: the Polish presidential election.  The health of Poland’s democracy has been in question for some time, with the government going down the Hungarian route of controlling the media, packing the courts and using chicanery to exploit the advantages of government to the hilt.

The Polish public have the opportunity, should they so choose, to change this on Sunday.  The second round of the presidential election takes place and it looks like a nail-biter.  The president is chosen by an absolute majority of votes cast, with a second round between the front two contenders if there is no winner on the first round.  

There have been 14 polls since the first round took place two weeks ago.  Eight show the incumbent, Andrzej Duda, winning. Six show the challenger, Rafal Trzaskowski, winning.  Only three show a gap of more than 1% either way (two for Duda, one for Trzaskowski).  

You’d think the betting markets would show this to be close to a coin-toss based on that.  Not a bit of it.  As at the time of writing, Duda was last matched on Betfair at 1.58 (4/7) and Trzaskowski at 2.72 (7/4).  You can understand a slight lean in Duda’s favour, given the polling, but that much?  As you can see from the tweets above, shadsy has his doubts.

I basically agree with shadsy that this market is skewed and for the reason he gives, but perhaps it’s not quite as pure as he suggests.  Let me explain.

He’s absolutely right to note that populist right wing candidates are regularly too short-priced.  We saw it in France.  We saw it in the Netherlands.  We saw it in Sweden.  While the radical right has undoubtedly been rising across Europe, bettors have consistently been overestimating their chances.  This house effect has been a most profitable feature for those who have been paying attention.

Given the polls, this looks to be at least part of what we are seeing here.  Is it all of it?  Perhaps not.

What makes Poland different from France, the Netherlands, Sweden and so on is that the populist right are already in power.  They have shown no attachment to democratic norms.  It is no longer treated as a full democracy in Freedom House’s ratings.  Would they try to rig the vote?

It’s thinkable.  It was said in Zimbabwe when Robert Mugabe was leader that the opposition had to win three times in any election: they had to win the vote, they had to win the count and they had to win the declaration.  Poland is not yet at Zimbabwean levels of democracy but if you bet on Rafal Trzaskowski, you’re betting among other things that the government will not cross democratic norms if he wins.

You should keep an eye on this for the US election too.  The Republicans have been shamelessly using tools of voter suppression to increase their chances in November.  Moreover, Donald Trump might not go quietly if he looks like losing and he has credible options to cause chaos if the race is tight.  If you think that truth and justice will automatically prevail in the USA, you’re a sap – the Republicans were able to strongarm their way to victory in both 1876 and 2000 despite losing the popular vote on each occasion and having a very debatable claim to the electoral college on each occasion too.  Donald Trump looks at least as ruthless as Rutherford Hayes and George W Bush.

So, yes, I am on Rafal Trzaskowski at 2.72 and I do tip it.  But I’m always wary about betting against the house when you’re not sure just how reputable it is.  This is a respectable bet but not sensational value. You have to put a price on the possibility that the dice might be loaded.

Alastair Meeks

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