Exploring Economic Populism, a Neglected, but Growing, Phenomenon

Abstract

What is the relationship between economic crises and populism? Once almost exclusively the domain of Latin Americanists, the study of populism has emerged as a leading research agenda for scholars who study Europe and the US. However, researchers have hitherto failed to systematically account for the logic of economic populism and the fact that populists emanating from either the left or the right tend to converge on a similar political economic model: protectionism, crony capitalism, and inveterate rent seeking. We provide a framework to make sense of this pattern and explain the systematic, mutually reinforcing association between crises and populism. We also adduce supporting evidence from very different places, Argentina, Chile, Greece, and Italy, and across disparate time periods. We argue that populism almost always threatens both liberal democracy and welfare state capitalism and ushers in economic collapse. We posit that a key reason for this is that, rather than seeing economic interactions as “win-win” situations, populists are obsessed with zero-sum thinking. We also speculate about what might be in store for European politics in light of the COVID-19 pandemic.