Narendra Modi ’s victory in the general election has left more than the Congress party confounded. The one class that still finds its compass revolving wildly is that of New Delhi’s cloistered “intellectuals"—journalists, members of the commentariat and, of course, the TV anchors who spent the last year repeating tirelessly that Modi could not win.

This is not the first election in which the forecast results have veered off the actual tally; this is seen in most elections. What stands out this time is the inability of this class to come to terms with the results. Instead of accepting a forecasting error, this class is busy proffering justifications that are ideologically motivated. Three are doing the rounds these days. One, that the Bharatiya Janata Party (BJP) received just 31% of the vote share and that 69% of those who cast the vote did not favour the BJP. Two, the first past the post system (FPTP), in which the winner in a poll does not necessarily receive the majority of the vote, is inherently unfair. Three, over time, governments in India have become increasingly unrepresentative as they are formed on the back of legislative groups that command dwindling vote shares.

What cannot be denied is that of all the contesting parties the BJP has the highest number of seats and the highest vote share. And that is what matters in a democracy. If these arguments could change that fact, surely they would be worth respecting.

The more interesting question is about the reasons behind generating and believing this line of thinking. It is helpful to compare what happens when forecasts and results deviate in three markets—financial markets, political markets (where political parties vie with each other for votes) and the market for news and opinion.

In a financial market, investors or portfolio managers put money in a particular instrument (say a stock or a bond) based on a future price forecast. If the forecast goes wrong, they lose money. Then, as a corrective procedure to avoid future losses, the forecast model is discarded or is re-evaluated. The same model is unlikely to be used again.

The same method applies to political/electoral outcomes. If a party loses votes as compared with the previous election or if the number of its seats in a legislature falls after an election, the party is bound to deliberate on its missteps: political and policymaking (if it was in government and loses power after an election). The same mistakes are unlikely to be repeated.

The reason for not repeating past mistakes is strong: there is a cost associated with making mistakes, you lose money or you lose political power. The mistake is likely to be repeated if the ratio of the benefit from making the mistake to its cost is high. In these markets, this ratio is either very low and is almost always negative.

This factor is not operative in the Indian news/opinion market—or more accurately the one in New Delhi. It does not matter if the forecasts go wrong. For example, in the 2014 Lok Sabha election, it was hotly debated if there was a Modi “wave" or not. In Uttar Pradesh, where the BJP won 71 out of the 80 seats, journalists—some of them very seasoned ones—made trips to the state and found no evidence of an overwhelming sentiment in favour of Modi or his party. Now, one can say that journalistic procedures are rather unsystematic. But what journalists are supposed to specialize in is acquiring thumb rules, based on experience, that help them arrive at better forecasts. In the case of intellectuals, probably, systematic observation helps them weed out wrong estimates the next time.

What was seen in this election season was something different. Until virtually the last week of voting, many opinion writers and journalists kept on repeating that the BJP was unlikely to win. It was expected to fall well short of a majority and then be forced to give up Modi in favour of a “secular" candidate in case it wanted to stitch together a government. Once the results became obvious, the same writers—within a span of hours—began making arguments to justify their wrong assessment. The BJP winning only 31% of the vote, the FPTP system being unfair and the lack of legitimacy of the coming BJP government are a part and parcel of this.

The simple explanation is there is no cost involved in opinion markets. Readers of these reports/opinion in the English language press are unlikely to abandon these newspapers/TV channels (it is a good empirical question why they won’t). There is, thus, no cost involved for the journalists themselves. Hence the in-built tendencies to either underplay their mistakes, or simply deny them by offering ever more creative justifications.

Country-wide, of course, this does not matter. Political choices are not made by reading English language newspaper reports. The process of citizens acquiring information to make informed political choices is different. The BJP’s thumping victory is testimony to the fact that what virtually amounted to a press campaign against Modi did not work. What happened in the end is the creation of an information bubble—not very different from the one often seen in financial markets—that has now been pricked.

Siddharth Singh is Editor (Views) at Mint. Reluctant Duelist will take stock of matters economic, political and strategic—in India and elsewhere—every fortnight.

Comments are welcome at siddharth.s@livemint.com. To read Siddharth Singh’s previous columns, go to www.livemint.com/reluctantduelist

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