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Political extremism and economic activity

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  • Rao, Matthew
  • Raschky, Paul A.
  • Tombazos, Christis G.

Abstract

We study the effect of economic activity on the vote share of extremist political parties in Europe. Using a model that addresses the prevalent endogeneity problem, which is likely to have discouraged similar research, we find that small fluctuations in income per-capita have significant inverse effects on the vote share of far-right parties. Our results explain the widespread success of such parties in entering European parliaments following the 2007–2008 crisis. They also suggest that, ceteris paribus, far-right parties on the margin of electoral thresholds run the risk of losing parliamentary representation in the face of a steadily recovering world economy.

Suggested Citation

  • Rao, Matthew & Raschky, Paul A. & Tombazos, Christis G., 2018. "Political extremism and economic activity," Economics Letters, Elsevier, vol. 170(C), pages 59-62.
    • Handle: RePEc:eee:ecolet:v:170:y:2018:i:c:p:59-62
    DOI: 10.1016/j.econlet.2018.05.027
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    Cited by:

    1. Markus Brückner & Hans Peter Grüner, 2020. "Economic growth and political extremism," Public Choice, Springer, vol. 185(1), pages 131-159, October.

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    More about this item

    Keywords

    Political extremism; Nationalism; Populism; Economic growth; Europe;
    All these keywords.

    JEL classification:

    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • G01 - Financial Economics - - General - - - Financial Crises
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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