Economic Distress and Support for Far-Right Parties - Evidence from Sweden

Abstract

This paper studies the effects of economic distress on support for radical right parties. Using Swedish election data, I show that layoff notices among low-skilled native-born workers account for 31 percent of the increased vote share for the Swedish radical right party the Sweden Democrats. The effect of layoff notices on support for the Sweden Democrats is larger in areas with a high share of low-skilled immigrants, and in areas with a low share of high-skilled immigrants. These findings are in line with theories suggesting that voters attribute their impaired economic status to immigration, due to labor market concerns. In addition, I use individual-level survey data to show that self-reported unemployment risk is positively associated with voting for the Sweden Democrats among low-skilled respondents while the opposite is true for high-skilled respondents, echoing the aggregate-level findings.