IDEAS home Printed from https://ideas.repec.org/p/igi/igierp/704.html

Economic Insecurity and the Demand of Populism in Europe

Author

Listed:
  • Massimo Morelli
  • Luigi Guiso
  • Helios Herrera
  • Tommaso Sonno

Abstract

We document the spiral of populism in Europe and the direct and indirect role of economic insecurity shocks. Using survey data on individual voting, we make two contributions to the literature, namely: (1) Economic insecurity shocks have a significant impact on the populist vote share, directly as demand for protection, and indirectly through the induced changes in trust and attitudes; (2) A key consequence of increased economic insecurity is a drop in turnout. The impact of this largely neglected turnout effect is substantial: conditional on voting, when economic insecurity increases almost 40% of the induced change in the vote for a populist party comes from the turnout channel. Keywords:turnout, trust in politics, voter sentiments JEL: D72, F68

Suggested Citation

  • Massimo Morelli & Luigi Guiso & Helios Herrera & Tommaso Sonno, 2023. "Economic Insecurity and the Demand of Populism in Europe," Working Papers 704, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    • Handle: RePEc:igi:igierp:704
    as

    Download full text from publisher

    File URL: https://repec.unibocconi.it/igier/igi/wp/2023/704.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Yann Algan & Sergei Guriev & Elias Papaioannou & Evgenia Passari, 2017. "The European Trust Crisis and the Rise of Populism," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 48(2 (Fall)), pages 309-400.
    2. Chase Foster & Jeffry Frieden, 2017. "Crisis of trust: Socio-economic determinants of Europeans’ confidence in government," European Union Politics, , vol. 18(4), pages 511-535, December.
    3. Dani Rodrik, 2018. "Populism and the economics of globalization," Journal of International Business Policy, Palgrave Macmillan, vol. 1(1), pages 12-33, June.
    4. repec:baf:cbafwp:cbafwp23204 is not listed on IDEAS
    5. repec:spo:wpmain:info:hdl:2441/2i9jel1usb85nr2j7tejsaldfu is not listed on IDEAS
    6. 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.
    7. 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.
    8. Colantone, Italo & Stanig, Piero, 2018. "Global Competition and Brexit," American Political Science Review, Cambridge University Press, vol. 112(2), pages 201-218, May.
    9. Deaton, Angus, 1985. "Panel data from time series of cross-sections," Journal of Econometrics, Elsevier, vol. 30(1-2), pages 109-126.
    10. Carlos Cinelli & Chad Hazlett, 2020. "Making sense of sensitivity: extending omitted variable bias," Journal of the Royal Statistical Society Series B, Royal Statistical Society, vol. 82(1), pages 39-67, February.
    11. Xinshu Zhao & John G. Lynch & Qimei Chen, 2010. "Reconsidering Baron and Kenny: Myths and Truths about Mediation Analysis," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 37(2), pages 197-206, August.
    12. Ľuboš Pástor & Pietro Veronesi, 2021. "Inequality Aversion, Populism, and the Backlash against Globalization," Journal of Finance, American Finance Association, vol. 76(6), pages 2857-2906, December.
    13. Maxim Ananyev & Sergei Guriev, 2019. "Effect of Income on Trust: Evidence from the 2009 Economic Crisis in Russia," The Economic Journal, Royal Economic Society, vol. 129(619), pages 1082-1118.
    14. Manuel Funke & Moritz Schularick & Christoph Trebesch, 2023. "Populist Leaders and the Economy," American Economic Review, American Economic Association, vol. 113(12), pages 3249-3288, December.
    15. Sergei Guriev & Elias Papaioannou, 2022. "The Political Economy of Populism," Journal of Economic Literature, American Economic Association, vol. 60(3), pages 753-832, September.
    16. repec:spo:wpmain:info:hdl:2441/1divsbu8t888r9vqektjbmlqoa is not listed on IDEAS
    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. Pierpaolo Battigalli, 2023. "A Note On Reduced Strategies And Cognitive Hierarchies In The Extensive And Normal Form," Working Papers 706, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    2. 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.
    3. 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.
    4. Chen, Shuai, 2023. "Unemployment, Immigration, and Populism," IZA Discussion Papers 16642, IZA Network @ LISER.
    5. Chen, Shuai, 2020. "Unemployment, Immigration, and Populism: Evidence from Two Quasi-Natural Experiments in the United States," GLO Discussion Paper Series 652, Global Labor Organization (GLO).
    6. Snower, Dennis J. & Bosworth, Steven J., 2021. "Economic, social and political fragmentation: Linking knowledge-biased growth, identity, populism and protectionism," European Journal of Political Economy, Elsevier, vol. 67(C).
    7. Cerqua, A. & Ferrante, C. & Letta, M., 2021. "Electoral Earthquake: Natural Disasters and the Geography of Discontent," GLO Discussion Paper Series 790, Global Labor Organization (GLO).
    8. Frédéric Docquier & Stefano Iandolo & Hillel Rapoport & Riccardo Turati & Gonzague Vannoorenberghe, 2024. "Populism and the skill content of globalisation," PSE Working Papers halshs-04960427, HAL.
    9. Marco Manacorda & Guido Tabellini & Andrea Tesei, 2022. "Mobile Internet and the Rise of Political Tribalism in Europe," Working Papers 941, Queen Mary University of London, School of Economics and Finance.
    10. Marco Manacorda & Guido Tabellini & Andrea Tesei, 2022. "Mobile Internet and the Rise of Communitarian Politics," CESifo Working Paper Series 9955, CESifo.
    11. Giordani, Paolo E. & Mariani, Fabio, 2022. "Unintended consequences: Can the rise of the educated class explain the revival of protectionism?," Journal of Economic Theory, Elsevier, vol. 200(C).
    12. Pan, Wei-Fong, 2023. "The effect of populism on high-skilled migration: Evidence from inventors," European Journal of Political Economy, Elsevier, vol. 79(C).
    13. Carl Leonard Fischer & Lorenz Meister, 2023. "Economic Determinants of Populism," DIW Roundup: Politik im Fokus 145, DIW Berlin, German Institute for Economic Research.
    14. Luigi Guiso & Massimo Morelli & Tommaso Sonno & Helios Herrera, 2021. "The Financial Drivers of Populism in Europe," EIEF Working Papers Series 2112, Einaudi Institute for Economics and Finance (EIEF), revised Sep 2021.
    15. Morelli, Massimo & Gennaro, Gloria & Lecce, Giampaolo, 2021. "Mobilization and the Strategy of Populism Theory and Evidence from the United States," CEPR Discussion Papers 15686, Centre for Economic Policy Research.
    16. Frédéric Docquier & Hillel Rapoport, 2025. "The vicious circle of xenophobia: immigration and right wing populism," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 40(122), pages 551-573.
    17. Gabriel, Ricardo Duque & Klein, Mathias & Pessoa, Sofia, 2022. "The Political Costs of Austerity," Working Paper Series 418, Sveriges Riksbank (Central Bank of Sweden).
    18. Albanese, Giuseppe & Barone, Guglielmo & de Blasio, Guido, 2022. "Populist voting and losers’ discontent: Does redistribution matter?," European Economic Review, Elsevier, vol. 141(C).
    19. Robert Gold, 2022. "From a better understanding of the drivers of populism to a new political agenda," Working Papers 4, Forum New Economy.
    20. Seabright, Paul & Gonnot, Jerome, 2021. "Establishment and Outsiders : Can Political Incorrectness and Social Extremism work as a Signal of Commitment to Populist Poli," CEPR Discussion Papers 15971, Centre for Economic Policy Research.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:igi:igierp:704. 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: the person in charge (email available below). General contact details of provider: http://www.igier.unibocconi.it/ .

    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.