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Political extremism and economic activity
- Rao, Matthew, Raschky, Paul A., Tombazos, Christis G.
- Economics letters 2018 v.170 pp. 59-62
- models, per-capita income, politics, risk, Europe
- 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.