Personal charisma or the economy?: Macroeconomic indicators of presidential approval ratings in Brazil

We test the degree to which presidential approval ratings are related to a series of economic indicators, controlling for the political scenario in Brazil. Results, from 1999M9 until 2010M5, show that unemployment and the minimum wage are the main variables that affect the ratings. There is also evidence that President Luis Inácio Lula da Silva has a higher approval rate than President Fernando Henrique Cardoso, keeping constant a reasonable number of important domestic and foreign indicators. However, when controlled for a time trend, differences in popularity between both presidents vanish as the sample size grows. Our results support the conclusion that the good state of the economy (given no political turmoil) is the main factor that explains and predicts Lula's high popularity.