Does Income Equality Make Us Populist?

Does Income Equality Make Us Populist?

Global Sustainable Development

Populism, a group of political ideas that are addressing the "ordinary people" who feel disregarded by established elite groups, has not lost significance in the last years. Despite the recent political failures of a few populist leaders, anti-elitist and anti-immigrant parties continue to be prevalent around the world.

The general narrative around populism tends to limit its focus to unemployment, immigration and inequality. Germany provides a suitable case study to test if these factors are significant predictors since its Eastern states continue to give the most support to the far-right populist Alternative für Deutschland (AfD), despite East Germany's low levels of income inequality, unemployment and share of foreigners.

To explore the relationship between income inequality and populism, quantitative data is used to regress the share of AfD votes on Bundesland Gini coefficients. Our results are then controlled for year dummies, unemployment, share of foreigners, East/West dummies and complemented by further qualitative research on the historical, political and socio-economic context.
We found that (1) the strong negative correlation between regional income inequality and populism is due to the absorption of other implications of the 40-year-long state socialism, (2) regional, Bundesland-level inequalities are not significant predictors of populist success as country-level inequalities are considered by voters and (3) perceptions of socio-economic and political issues have a greater role in electoral outcomes than the real size of these issues.

Szebasztian Csernik-Tihn

2021