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The Macroeconomy and Individuals’ Support for Democracy

  • Friedrichsen, J.
  • Zahn, P.

How important are national macroeconomic indicators for people’s satisfaction with democracy? This paper empirically explores the link from macroeconomic variables to support for established democratic systems. We combine country-level data on growth, inflation, and unemployment from the OECD with survey data from the Eurobarometer for nineWestern European countries for the period 1976-2001. We regress individual satisfaction with democracy on macroeconomic variables and individual controls. Our regressions include country-specific time trends as well as fixed effects for countries and surveyyears. Pooling observations from nine countries, we find that growth (inflation and unemployment) is positively (negatively) correlated with satisfaction with democracy. The effect goes beyond what can be explained by individual characteristics and is non-negligible if interpreted in light of the recent economic crisis. Our findings are robust to alternative specifications using logit and ordered logit models.

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File URL: http://www.econ.cam.ac.uk/research/repec/cam/pdf/cwpe1104.pdf
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Paper provided by Faculty of Economics, University of Cambridge in its series Cambridge Working Papers in Economics with number 1104.

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Date of creation: 26 Jan 2011
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Handle: RePEc:cam:camdae:1104
Contact details of provider: Web page: http://www.econ.cam.ac.uk/index.htm

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  1. Di Tella, R. & MacCulloch, R.J.: Oswald, A.J., 1997. "The Macroeconomics of Happiness," Papers 19, Centre for Economic Performance & Institute of Economics.
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  10. Martin Gassebner & Michael J. Lamla & James Raymond Vreeland, 2013. "Extreme Bounds of Democracy," Journal of Conflict Resolution, Peace Science Society (International), vol. 57(2), pages 171-197, April.
  11. Robert J. MacCulloch & Rafael Di Tella & Andrew J. Oswald, 2001. "Preferences over Inflation and Unemployment: Evidence from Surveys of Happiness," American Economic Review, American Economic Association, vol. 91(1), pages 335-341, March.
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  19. repec:pri:cheawb:deaton_income_health_and_wellbeing_around_the_world_evidence_%20from_gall is not listed on IDEAS
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