Date of Award


Degree Type


Degree Name

Master of Science (MS)


Economics and Finance

Committee Chair(s)

Tyler Brough


Tyler Brough


Benjamin Blau


Ryan Whitby


The 2016 US Presidential Election was hallmarked by significant policy differences between the Democratic and Republican parties. Healthcare reform was one of the most significant and highly debated issues between the candidates; Hillary Rodham Clinton (D-NY) and Donald J. Trump (R-NY). The Republican platform of repeal and replace was in direct opposition to the expansionary viewpoints of the Democratic Party which was to promote increased regulations on the healthcare and pharmaceutical industries. The media narrative in the months preceding the election assumed a Democratic victory as a sure thing. The New York Times gave Hillary Clinton a 98.5% chance of victory at the beginning of election night, making the landslide victory of Donald Trump over Hillary Clinton one of the greatest political upsets of the modern political era. In order to determine if market indicators were predicting a Republican victory in the election; we analyze financial performance of securities in the healthcare sector through standard event study techniques. In particular I use multivariate regression to calculate cumulative abnormal returns centered around varying time windows surrounding the Presidential Election. Financial data from 402 relevant healthcare firms is used in the analysis. Significant cumulative abnormal returns are observed for pharmaceutical/drug companies and healthcare companies in the event windows leading up to the election date. While negative in longer pre-event windows, returns become sharply positive on the days prior to the election. This is particularly true for pharmaceutical firms and healthcare stocks. Despite the prediction of Democrat victory in both the polls and in prediction markets, it is possible to show that the stock market accurately predicted a Republican victory in the General Election despite overwhelming odds indicating a Democrat victory.