Why the Iowa caucuses are important

But just what can a single state with a relatively small number of delegates up for grabs tell us about the rest of the primary season? If history is any guide, the Iowa caucuses really do matter.

The winner of the Iowa caucuses on the Democratic side has frequently gone on to be the Democratic nominee. Since 1972, there have been nine primary seasons without a Democratic incumbent president running. Six of nine times (67%), the Iowa winner was also the Democratic nominee. One off these non-successes (Tom Harkin in 1992) was from Iowa.

The success rate of Iowa winners does decrease, if you expand it out to include Republican caucuses as well. Including those, nine of 16 (56%) winners of the Iowa caucuses went on to win their party's nomination.

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Remember, there have been more than 100 candidates who have participated in the caucuses since 1972. So something that tells us the winner over half the time is truly a value add.

A closer look at the polling indicates that Iowa isn't just correlated with success. It likely causes it both in the next contest (the New Hampshire primary) and nationally.

Winners of the Iowa caucuses have jumped a median of three percentage points in the New Hampshire primary polls following their win. Moreover, outperforming expectations (i.e. polling) in Iowa seems to have an additional effect. For every point that candidates outperform their Iowa polls, they get a bounce of 0.5 points in New Hampshire polls. Candidates who underperform their polls in Iowa see their New Hampshire poll number deflate by 0.5 points for every point they undershoot their New Hampshire polls.

The effects nationally are even greater. As I noted last week, Iowa winners get a seven-point bounce in the national polls on median. For every point candidates over-perform their Iowa polls, they get a 0.7 point lift in their national polling.

The last Democratic primary that was as crowded as this one demonstrates the power of Iowa. Democrat John Kerry came from nowhere to win Iowa in 2004. By winning and outperforming his Iowa polls, Kerry saw a double-digit bounce in both his New Hampshire and national numbers. He would easily win both.

Now, it's quite possible that Iowa's effect this year will be muted. Iowa is not racially representative of the national primary electorate. In fact, it's not anywhere close. The likely Iowa Democratic caucuses' electorate is about 30 points more white than the potential primary electorate is nationwide. Given that Democrat Joe Biden is doing so much better among black voters, he could recover from an Iowa loss.

Still, that's a dangerous proposition for him. When Democrat Barack Obama won Iowa in 2008, he gained tremendously with black voters.

The bottom line is winning (or losing) the Iowa caucuses is a big deal. Winning Iowa doesn't make you a sure thing to win the nomination, but it is certainly helps.