Working Paper: NBER ID: w27526
Authors: Dani Rodrik
Abstract: There is compelling evidence that globalization shocks, often working through culture and identity, have played an important role in driving up support for populist movements, particularly of the right-wing kind. I start with an empirical analysis of the 2016 presidential election in the U.S. to show globalization-related attitudinal variables were important correlates of the switch to Trump. I then provide a conceptual framework that identifies four distinct channels through which globalization can stimulate populism, two each on the demand and supply sides of politics, respectively. I evaluate the empirical literature with the help of this framework, discussing trade, financial globalization, and immigration separately. I conclude the paper by discussing some apparently anomalous cases where populists have been against, rather than in favor of trade protection.
Keywords: globalization; populism; right-wing populism; economic shocks; cultural identity
JEL Codes: F1; F3; F6
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| economic dislocation (J63) | demands for anti-elite redistributive policies (D72) |
| globalization shocks (F69) | support for populist movements (D72) |
| globalization shocks (F69) | cultural insecurities (F52) |
| cultural insecurities (F52) | sharper distinctions between 'insiders' and 'outsiders' (Z13) |
| economic shocks (F69) | political candidates adopting populist platforms (D72) |
| economic shocks (F69) | candidates inflaming cultural tensions (J15) |
| perceptions of economic conditions (E66) | political preferences (D72) |