Economic Insecurity and the Causes of Populism, Reconsidered

Abstract

Growing conventional wisdom holds that a chief driver of the populist vote is economic insecurity. I contend that this view overstates the role of economic insecurity as an explanation in several ways. First, it conflates the significance of economic insecurity in influencing the election outcome on the margin with its significance in explaining the overall populist vote. Empirical findings indicate that the share of populist support explained by economic insecurity is modest. Second, recent evidence indicates that voters’ concern with immigration—a key issue for many populist parties—is only marginally shaped by its real or perceived repercussions on their economic standing. Third, economics-centric accounts of populism treat voters’ cultural concerns as largely a byproduct of experiencing adverse economic change. This approach underplays the reverse process, whereby disaffection from social and cultural change drives both economic discontent and support for populism.

An exploratory study of populism: the municipality-level predictors of electoral outcomes in Italy

“…Between them, Autor et al (2016) stress that penetration of imports from China is a decisive factor to explain the increasing polarization in US politics. The outcome of the Brexit referendum and votes for populist and far-right parties across Europe were explained across the same lines by Colantone and Stanig (2018a, 2018b, 2019, by Becker et al (2017) and by Alabrese et al (2019). A few papers explore more in general the correlation between economic insecurity and populist votes.…”

The Rise of Populism and the Revenge of the Places That Don’t Matter

“…The rise of populism has pitched defenders of cultural explanations against those who consider that the recent shift is fundamentally driven by economic transformations and woes [18,39]. This distinction has triggered considerable discussion about which explanation, if at all, prevails.…”

Betrayed by the Elites: How Corruption Amplifies the Political Effects of Recessions

“…Third, our paper contributes to a recent, but fast-growing, strand of literature studying the impact of economic shocks on political fragmentation and polarization (Mian et al, 2014;Funke et al, 2016;Dal Bó et al, 2018), and on the rise of populism (Guiso et al, 2018a and2018b;Algan et al, 2017; also see Margalit, 2019a, for a review).…”