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Economic growth and political extremism

Author

Listed:
  • Markus Brückner

    (Australian National University)

  • Hans Peter Grüner

    (University of Mannheim
    CEPR)

Abstract

We argue that the growth rate, but not the level of aggregate income, affects the support for extreme political parties. In our model, extreme parties offer short-run benefits to part of the population at the expense of a minority. Growth effects on the support for such parties arise when uncertainty exists over whether the same subset of individuals will receive the same benefits in the future. More people are willing to take political risks if economic growth is slow. Based on a panel of 16 European countries, our empirical analysis shows that slower growth rates are associated with a significant increase in right-wing extremism. We find no significant effect of economic growth on the support for extreme left-wing parties.

Suggested Citation

  • Markus Brückner & Hans Peter Grüner, 2020. "Economic growth and political extremism," Public Choice, Springer, vol. 185(1), pages 131-159, October.
    • Handle: RePEc:kap:pubcho:v:185:y:2020:i:1:d:10.1007_s11127-019-00745-w
    DOI: 10.1007/s11127-019-00745-w
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    References listed on IDEAS

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    More about this item

    Keywords

    Economic growth; Political extremism; Inequality;
    All these keywords.

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

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