IDEAS home Printed from https://ideas.repec.org/a/bla/ajecsc/v84y2025i5p797-821.html

Neoliberalism and Globalization Are Not Undermining Democracy: Panel Evidence From More Than 140 Countries, 1980–2022

Author

Listed:
  • Stefani Branilović
  • Tibor Rutar

Abstract

The rise of neoliberal reforms in the period of globalization is often claimed to be linked with wider outcomes, such as increased inequality, unemployment, and different cultural grievances. Because of these economic and cultural concerns, voters might seek solutions to their ostensible problems by turning to illiberal populist parties, which tend to undermine democracy and its basic principles. The present article empirically tests if neoliberalism, operationalized with the Fraser Institute's Economic Freedom of the World, and globalization, operationalized with the KOF's Globalization Index, were somehow associated with democratic integrity. The analysis is performed through fixed‐effects regressions in more than 140 countries between 1980 and 2022. The main results show that over‐time increases in both neoliberalism and globalization predicted over‐time increases in five different types of democracy scores. Furthermore, the analyses with disaggregated indexes showed that freedom of international trade, modesty of regulation, legal system and property rights, and social globalization are what drive the relationship at the aggregate level. Results also showed that there are no statistically significant relationships between economic freedom and Freedom House's democracy scores specifically in the time period between 2011 and 2022. Furthermore, there are no statistically significant results indicating a relationship between globalization and democracy during the same time period. This is an interesting observation since this time period is commonly understood as most clearly embodying the democratic recession.

Suggested Citation

  • Stefani Branilović & Tibor Rutar, 2025. "Neoliberalism and Globalization Are Not Undermining Democracy: Panel Evidence From More Than 140 Countries, 1980–2022," American Journal of Economics and Sociology, Wiley Blackwell, vol. 84(5), pages 797-821, November.
    • Handle: RePEc:bla:ajecsc:v:84:y:2025:i:5:p:797-821
    DOI: 10.1111/ajes.12635
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/ajes.12635
    Download Restriction: no
    File URL: https://libkey.io/10.1111/ajes.12635?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Nita Rudra, 2005. "Globalization and the Strengthening of Democracy in the Developing World," American Journal of Political Science, John Wiley & Sons, vol. 49(4), pages 704-730, October.
    2. de Haan, Jakob & Sturm, Jan-Egbert, 2000. "On the relationship between economic freedom and economic growth," European Journal of Political Economy, Elsevier, vol. 16(2), pages 215-241, June.
    3. Andreas Bergh & Anders Kärnä, 2022. "Correction to: Globalization and populism in Europe," Public Choice, Springer, vol. 192(1), pages 193-199, July.
    4. David Autor & David Dorn & Gordon Hanson & Kaveh Majlesi, 2020. "Importing Political Polarization? The Electoral Consequences of Rising Trade Exposure," American Economic Review, American Economic Association, vol. 110(10), pages 3139-3183, October.
    5. Italo Colantone & Piero Stanig, 2018. "The Trade Origins of Economic Nationalism: Import Competition and Voting Behavior in Western Europe," American Journal of Political Science, John Wiley & Sons, vol. 62(4), pages 936-953, October.
    6. Axel Dreher & Noel Gaston & Pim Martens, 2008. "Measuring Globalisation," Springer Books, Springer, number 978-0-387-74069-0, March.
    7. Niklas Potrafke, 2009. "Did globalization restrict partisan politics? An empirical evaluation of social expenditures in a panel of OECD countries," Public Choice, Springer, vol. 140(1), pages 105-124, July.
    8. James D. Gwartney & Robert A. Lawson, 2024. "The creation of the Economic Freedom of the World index," Chapters, in: Niclas Berggren (ed.), Handbook of Research on Economic Freedom, chapter 2, pages 16-30, Edward Elgar Publishing.
    9. Bergh, Andreas & Nilsson, Therese, 2010. "Do liberalization and globalization increase income inequality?," European Journal of Political Economy, Elsevier, vol. 26(4), pages 488-505, December.
    10. Axel Dreher & Noel Gaston & Pim Martens, 2008. "The Measurement of Globalisation," Springer Books, in: Measuring Globalisation, chapter 3, pages 25-74, Springer.
    11. Yotam Margalit, 2019. "Economic Insecurity and the Causes of Populism, Reconsidered," Journal of Economic Perspectives, American Economic Association, vol. 33(4), pages 152-170, Fall.
    12. Li, Quan & Reuveny, Rafael, 2003. "Economic Globalization and Democracy: An Empirical Analysis," British Journal of Political Science, Cambridge University Press, vol. 33(1), pages 29-54, January.
    13. Marcus Noland, 2020. "Protectionism under Trump: The China Shock, Deplorables, and the First White President," Asian Economic Policy Review, Japan Center for Economic Research, vol. 15(1), pages 31-50, January.
    14. Daniel Hoechle, 2007. "Robust standard errors for panel regressions with cross-sectional dependence," Stata Journal, StataCorp LLC, vol. 7(3), pages 281-312, September.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Backes, Annika & Mueller, Steffen, 2024. "Import shocks and voting behavior in Europe revisited," European Journal of Political Economy, Elsevier, vol. 83(C).
    2. Andreas Bergh & Anders Kärnä, 2022. "Correction to: Globalization and populism in Europe," Public Choice, Springer, vol. 192(1), pages 193-199, July.
    3. Giray Gozgor, 2022. "The role of economic uncertainty in the rise of EU populism," Public Choice, Springer, vol. 190(1), pages 229-246, January.
    4. Isaac Ketu & Stéphane Mbiankeu Nguea, 2024. "Globalization and the “zero hunger” goal in Africa: Starving in an open world?," Journal of International Development, John Wiley & Sons, Ltd., vol. 36(7), pages 2769-2789, October.
    5. Eugenio Levi & Isabelle Sin & Steven Stillman, 2021. "Understanding the Origins of Populist Political Parties and the Role of External Shocks," Motu Working Papers 21_09, Motu Economic and Public Policy Research.
    6. Eugenio Levi & Isabelle Sin & Steven Stillman, 2024. "The lasting impact of external shocks on political opinions and populist voting," Economic Inquiry, Western Economic Association International, vol. 62(1), pages 349-374, January.
    7. Eugenio Levi & Fabrizio Patriarca, 2020. "An exploratory study of populism: the municipality-level predictors of electoral outcomes in Italy," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 37(3), pages 833-875, October.
    8. Osman S Kiratli, 2023. "Loving globalization: High-growth enterprises and public opinion on globalization in Europe," European Union Politics, , vol. 24(2), pages 286-306, June.
    9. Bergh, Andreas & Kärnä, Anders, 2024. "Populist Parties’ Popularity Post Power," Working Paper Series 1491, Research Institute of Industrial Economics.
    10. François Facchini & Louis Jaeck, 2021. "Populism and the rational choice model: The case of the French National Front," Rationality and Society, , vol. 33(2), pages 196-228, May.
    11. John Kuk & Deborah Seligsohn & Jiakun Jack Zhang, 2022. "The partisan divide in U.S. congressional communications after the China shock," Economics and Politics, Wiley Blackwell, vol. 34(3), pages 494-526, July.
    12. Stephanie Meinhard & Niklas Potrafke, 2012. "The Globalization–Welfare State Nexus Reconsidered," Review of International Economics, Wiley Blackwell, vol. 20(2), pages 271-287, May.
    13. Ftergioti, Stamatia, 2017. "Neighbors and Friends: The Effect of Globalization on Party Positions," MPRA Paper 76662, University Library of Munich, Germany.
    14. Bez, Charlotte & Steckel, Jan & Naumann, Lennard, 2024. "A Political Backlash to Job Losses in Coal? The Case of Colombia," VfS Annual Conference 2024 (Berlin): Upcoming Labor Market Challenges 302390, Verein für Socialpolitik / German Economic Association.
    15. Fornaro, Paolo & Kaihovaara, Antti, 2020. "Microdynamics, granularity and populism: The Finnish case," European Journal of Political Economy, Elsevier, vol. 65(C).
    16. Robert Gold, 2022. "From a better understanding of the drivers of populism to a new political agenda," Working Papers 4, Forum New Economy.
    17. Salamaliki, Paraskevi K., 2024. "Globalization and fiscal policy after financial crises," European Journal of Political Economy, Elsevier, vol. 85(C).
    18. Marcella Alsan & Katherine Eriksson & Gregory Niemesh, 2020. "Understanding the Success of the Know-Nothing Party," NBER Working Papers 28078, National Bureau of Economic Research, Inc.
    19. Marco Manacorda & Guido Tabellini & Andrea Tesei, 2022. "Mobile internet and the rise of political tribalism in Europe," CEP Discussion Papers dp1877, Centre for Economic Performance, LSE.
    20. repec:jpe:journl:2054 is not listed on IDEAS
    21. Francisco Costa & Angelo Marcantonio & Rudi Rocha, 2023. "Stop Suffering! Economic Downturns and Pentecostal Upsurge," Journal of the European Economic Association, European Economic Association, vol. 21(1), pages 215-250.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ajecsc:v:84:y:2025:i:5:p:797-821. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0002-9246 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.