Economic interventions, economic perceptions and political support during the Eurozone crisis

Abstract

AbstractWhat is the effect of external economic intervention on political support and economic evaluations? We argue that economic interventions systematically worsen support for governing institutions and much of this is mediated through updating economic perceptions, at least during the Eurozone crisis. We evidence this with two analyses. First, we provide the first quasi-experimental evidence to show that intervention worsened both political support and economic evaluations. Second, we conduct a mediation analysis using Eurobarometer data to quantify how much of the effect of intervention is mediated by economic evaluations. This has broader implications for understanding how citizens react to international integration, international cues, and the process of forming judgements of political support.