Impact of Governance on Populist Rhetoric

Abstract

The phenomenon of populism is widespread in the 21st century. In this paper, we analyze the correlation between the World Bank’s six worldwide governance indicators and populism, which is proxied by the populist rhetoric of government representatives. The panel data includes 40 developing and developed countries and covers the period from 2000 to 2018. The results suggest that good governance may help to reduce populist rhetoric. However, we show that a certain threshold of governance quality must be met to mitigate populist rhetoric. Refugee immigration and one-party dominance, on the other hand, increase populist rhetoric. Despite frequent claims, we do not find robust evidence that merchandise trade or a high unemployment rate strengthens populism.