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An Economic Theory of Populism: Political Disequilibrium and Democratic Instability
[Une théorie économique du populisme : déséquilibre politique et instabilité démocratique]

Author

Listed:
  • Alexandre Chirat

    (CRESE - Centre de REcherches sur les Stratégies Economiques (UR 3190) - UFC - Université de Franche-Comté - UBFC - Université Bourgogne Franche-Comté [COMUE])

  • Cyril Hédoin

    (REGARDS - Recherches en Économie Gestion AgroRessources Durabilité Santé- EA 6292 - URCA - Université de Reims Champagne-Ardenne - MSH-URCA - Maison des Sciences Humaines de Champagne-Ardenne - URCA - Université de Reims Champagne-Ardenne, CRIEG - Centre de Recherche Interdisciplinaire Economie Gestion - MSH-URCA - Maison des Sciences Humaines de Champagne-Ardenne - URCA - Université de Reims Champagne-Ardenne)

Abstract

This paper deduces conditions under which populism successfully emerges in democratic contexts. Building on Downs's economic theory of democracy, it hinges on three assumptions: uncertainty, rationality, and democratic stability. This theory considers three main types of agents: citizens, political parties, and information providers. We demonstrate that the necessary and sufficient conditions for a populist party to emerge and gain significant electoral support are 1) a political disequilibrium between demand (citizens' preferences) and supply (parties' platforms) combined with 2) democratic instability due to ideological polarization. Such conditions provide the rationale behind populist anti-elitism and its thin nature as an ideology. Since this paper provides a theoretical account of populism that, while sharing Downsian roots, differs from main political economy models of populism, we provide a systematic comparison. In particular, we show that the conditions under which the Median Voter Theorem is relevant are at odds with the conditions required to account for populism.

Suggested Citation

  • Alexandre Chirat & Cyril Hédoin, 2025. "An Economic Theory of Populism: Political Disequilibrium and Democratic Instability [Une théorie économique du populisme : déséquilibre politique et instabilité démocratique]," Post-Print hal-05414427, HAL.
    • Handle: RePEc:hal:journl:hal-05414427
    Note: View the original document on HAL open archive server: https://hal.science/hal-05414427v1
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    References listed on IDEAS

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