What can we learn from research by a Tulane University professor who looked at decades of gubernatorial elections and economic data? John Hood explains.

She found that, on average, business investment in the months before election days is about five percent lower in states with gubernatorial elections than in states without them. The investment decline is even larger, about 15 percent, for companies more likely to be affected by subsequent policy changes, such as small firms doing most of their total business within the state.

What happens after the election? In states that elect new governors, business confidence and investment recovers from the dip, but typically doesn’t recover fully for at least a year. On the other hand, when incumbent governors are reelected, business investment tends to rise quickly. CEOs and investors already know pretty much what they’re going to get from the state’s executive branch, and can plan accordingly.

It’s evidence that elections matter in more ways than we might think. Read Hood’s full piece here.