Sunday, November 25, 2012

Probability of forming Majority Government

As I build a robust aggregated poll, one question I am wrestling with is how to present the findings. If we start with the trend line from my naive aggregation of the two-party preferred (TPP) polls ...

I am looking at using a Monte Carlo  technique to convert this TPP poll estimate to the probability of forming majority government. What this technique shows (below) is that the party with 51 per cent or more of the two-party preferred vote is almost guaranteed to form majority government.

There is also a realm where the two-party preferred vote is close to 50-50. In this realm, the likely outcome is a hung Parliament. When both lines fall below the 50 per cent threshold, this model is predicting a hung Parliament.

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