Policy Performance and Satisfaction with Democracy

Abstract

In this paper we examine how subjective perception of government's policy performance affects satisfaction with how democracy works in Iceland. This we base on the argument that the public is aware of and evaluating the governments' performance when the political system is faced with a major crisis that has been extensively publicly debated and triggered widespread protests. The financial and political crisis in Iceland 2008-09 provides an opportunity to examine if government performance can be seen as a causal factor explaining satisfaction with the democratic process. We take into account two alternative explanations; that satisfaction with how democracy works depends on citizens' belief in how well the representative system works; and if they are more satisfied when their party is represented in government. Our principal conclusion is that subjective policy performance is the main explanation for citizens' increased dissatisfaction with democracy during a severe crisis.

Retrospective Voting on the Party Level: An Icelandic Test

“…Traditionally, the country has a stable party system consisting of four parties, usually complemented with some short‐lived smaller parties (for more discussion on the Icelandic setting, and recent elections more specifically, see Önnudóttir et al ). In the election preceding the election under investigation (i.e., in 2009) the longstanding dominance of the right‐winged Independence Party was broken as it was punished for the financial crisis (Önnudóttir & Harðarson ; Indriðason et al ; Önnudóttir et al ). This gave rise to a new coalition between the left‐wing Social Democratic Alliance and Left‐Green Movement.…”

The "Pots and Pans" protests and requirements for responsiveness of the authorities

“…The matter was finally settled by the EFTA court's ruling in February 2013 in favour of the Icelandic authorities in regard to the terms of the reimbursement (EFTA Surveillance Authority n.d.). Önnudóttir and Harðarson (2011) point out examples of the direct consequences of the recession: the currency restriction imposed in October 2008, rising unemployment, inflation and the need for assistance from the International Monetary Fund (IMF). As early as October 2008, protesters started to gather outside the parliament, and their main demands were that the government should resign, an early election should be held, and that the board of the Central Bank, together with the CEO and board of directors of the Icelandic Supervisory Authority, should resign.…”

“…Shortly after that, a series public meetings (both indoors and outdoors) started, where social critics, intellectuals and activists gave speeches about the situation. Önnudóttir and Harðarson (2011) describe how the government early on seemed intent on ignoring the protests; but as the weeks passed, the protests intensified in size and noise. After almost four months of protesting, and some minor clashes between the protesters and the police, the government gave in and resigned at the end of January 2009.…”

Critical Election in the Wake of an Economic and Political Crisis: Realignment of Icelandic Party Voters?

“…Weekly protests in front of the Iceland parliament started in early October 2008 (Önnudóttir & Harðarson ). Icelanders were not the only ones to protest in the wake of the global credit crunch, but they were the first ones.…”

“…Eight years later in 2016, it still remained low at 17 percent) (Gallup Iceland ). Dissatisfaction with how democracy works in Iceland went from 29 percent in 2007 to 56 percent in 2009 (Önnudóttir & Harðarson ), but data from the 2013 ICENES show that dissatisfaction had recovered to 33.1 percent. In the 2009 election, one new party (the Civic Movement), with roots in the protest movement, gained representation, but it dissolved before the 2013 election.…”