A Costly Commitment: Populism, Economic Performance, and the Quality of Bureaucracy

Abstract

We study the consequences of populism for economic performance and the quality of bureaucracy. When voters lose trust in representative democracy, populists strategically supply unconditional policy commitments that are easier to monitor for voters. When in power, populists try to implement their policy commitments regardless of financial constraints and expert assessment of the feasibility of their policies, worsening government economic performance and dismantling resistance from expert bureaucrats. With novel data on more than 8,000 Italian municipalities covering more than 20 years, we estimate the effect of electing a populist mayor with a close‐election regression discontinuity design. We find that the election of a populist mayor leads to smaller repayments of debts, a larger share of procurement contracts with cost overruns, higher turnover among top bureaucrats—driven by forced rather than voluntary departures—and a sharp decrease in the percentage of graduate bureaucrats.

The political, psychological, and social correlates of cryptocurrency ownership

“…Taken together, the results presented here and the future research avenues they might speak to broader global trends in distrust, populism, and cynicism of established institutions [ 71 – 75 ], as well as their nonnormative behavioural and society-wide consequences [ 76 , 77 ]. We are in era where established authorities are under attack, be they political institutions or financial markets [ 31 , 35 , 36 , 77 – 79 ].…”

The Populist Dynamic: Experimental Evidence on the Effects of Countering Populism

“…To rationalize our results we develop a theoretical framework where voters who no longer trust traditional parties either abstain or vote for populist parties committing to specific (economic or identity) policies, as long as the commitment credibility is strong enough (Bellodi, Morelli and Vannoni, 2024;Bellodi et al, 2023). In this setting, our information treatments can be interpreted as an exogenous shock to the commitment credibility of economic populists-the Five Star Movement and the League.…”