EUFIRST 

Globalization, Inequality and Populism Across Europe

Goals
The EUFIRST research project, funded by the Luxembourg National Research Fund (FNR) (EUFIRST, n.13956644) and the Belgian Fund for Scientific Research (FNRS), aims to deepen our understanding of several crucial aspects:
  1. The factors influencing natives' attitudes towards trade and migration, whether hostile or positive.
  2. The specific determinants contributing to the rise of left-wing and right-wing populism.
  3. The political dynamics resulting from the entry or growth of populist parties and their impact on the traditional parties' political agenda.
  4. The reverse causal effects of populism on the scale and structure of trade and immigration, leading to potential vicious circles.

The project is led by Frédéric Docquier, Eugenio Peluso from LISER, and Gonzague Vannoorenberghe from UCLouvain. EUFIRST aims to shed light on these complex phenomena and provide valuable insights for policymakers and society at large.
Team

Research outputs

Research papers

Populism and the Skill-Content of Globalization: Evidence from the Last 60 Years

F. Docquier, L. Guichard, S. Iandolo, H. Rapoport, R. Turati, G. Vannoorenberghe
CESifo Working Paper Series 10068

We analyze the long-run evolution of populism and explore the role of globalization in shaping such evolution. We use an imbalanced panel of 628 national elections in 55 countries over 60 years. A first novelty is our reliance on both standard (e.g., the "volume margin", or vote share of populist parties) and new (e.g., the "mean margin", a continuous vote-weighted average of populism scores of all parties) measures of the extent of populism. We show that levels of populism in the world have strongly fluctuated since the 1960s, peaking after each major economic crisis and reaching an all-time high -- especially for right-wing populism in Europe -- after the great recession of 2007-10. The second novelty is that when we investigate the "global" determinants of populism, we look at trade and immigration jointly and consider their size as well as their skill-structure. Using OLS, PPML and IV regressions, our results consistently suggest that populism responds to globalization shocks in a way which is closely linked to the skill structure of these shocks. Imports of low-skill labor intensive goods increase both total and right-wing populism at the volume and mean margins, and more so in times of de-industrialization and of internet expansion. Low-skill immigration, on the other hand, tends to induce a transfer of votes from left-wing to right-wing populist parties, apparently without affecting the total. Finally, imports of high-skill labor intensive goods, as well as high-skill immigration, tend to reduce the volume of populism. 

Exit and Voice: Germany, 1848–1933

T. Barsbai, H. Rapoport
Preliminary version (abstract available only)

Albert Hirschman hypothesized that more exit leads to less voice. We test this conjecture in the context of Germany. In the five years that followed the failed revolutions of 1848, more than one million Germans emigrated to the United States. We explore the political consequences of this exodus. We show that differently from earlier and later emigration waves -- which were economically rather than politically motivated – the intensity of emigration during the revolutionary period significantly affected political outcomes within Germany over the course of eighty years, culminating in the rise to power of the Nazi Party. Specifically, a one-standard deviation in emigration rates between 1848 and 1854 is associated with an increase in the share of votes for the Nazi Party between 0.1 to 0.3 standard deviations. We show that both the emigration of ordinary citizens and of prominent political leaders mattered, and that selective entry and exit of local newspapers on ideological grounds as well as the presence and composition of social clubs are likely mechanisms behind our results. Overall, our results suggest that the well-documented contribution of the forty-eighters to democracy building in the US (Dipple and Helblich, 2021) came at the price of less democracy in Germany.

Closed communities and spatial separation

F. Andreolli, L. Guichard, E. Peluso
Preliminary version (abstract available only)

The spatial arrangement of different communities in the urban space is usually described in terms of segregation, by looking at the concentration of distinct groups across a well-defined partition of the city. In this paper we propose a new methodology to measure the degree of spatial separation between two different communities, by taking into account how their location can favor the contact between people of two different groups. We show that separation is distinct, yet related, to clustering and segregation and we illustrate as segregation and separation can concur to determine individual sorting à la Schelling (1969). An empirical application on the distribution of natives and foreign-born individuals in Luxembourg, a high-immigration rich country, allows us to uncover potential patterns and drivers of separation at the local level.

A Costly Commitment: Populism, Economic Performance, and the Quality of Bureaucracy

L. Bellodi, M. Morelli, M. Vannoni
Online version, published in American Journal of Political Science

We study the consequences of populism for economic performance and the quality of bureaucracy. When voters lose trust in representative democracy, populists strategically supply unconditional policy commitments that are easier to monitor for voters. When in power, populists implement their policy commitments regardless of financial constraints and expert assessment of the feasibility of their policies, worsening government economic performance and dismantling resistance from expert bureaucrats. With novel data on more than 8,000 Italian municipalities covering 20 years, we estimate the effect of electing a populist mayor with a close-election regression discontinuity design. We find that the election of a populist mayor leads to more debts, a larger share of procurement contracts with cost overruns, higher turnover among top bureaucrats – driven by forced rather than voluntary departures – and a sharp decrease in the percentage of graduate bureaucrats. These results contribute to the literature on populism, government performance, and bureaucratic capacity.

Are immigrants more left leaning than natives?

S. Moriconi, G. Peri, R. Turati
NBER Working paper 30523

We analyze whether second-generation immigrants have different political preferences relative to observationally identical children of citizens in the host countries. Using data on individual voting behavior in 22 European countries between 2001 and 2017, we characterize each vote on a left-right scale based on the ideological and policy positions of the party receiving the vote. In the first part of the paper, we characterize the size of the "left-wing bias" in the vote of second-generation immigrants after controlling for a large set of individual characteristics and origin and destination country fixed effects. We find a significant left-wing bias of second-generation immigrants, comparable in magnitude to the left-wing bias associated with living in urban (rather than rural) areas. We then show that this left-wing bias is associated with stronger preferences for inequality-reducing government intervention, internationalism and multiculturalism. We do not find that second-generation immigrants are biased towards or away from populist political agendas.

The Impact of Immigration on Workers’ Protection

A. Levai, R. Turati
LISER Working Paper 2022-10

Even though the existing literature investigating the labor market impact of immigration assumes, implicitly or explicitly, that the law or labor market regulation is exogenous to immigration (in terms of both size and composition), this is not necessarily the case. To examine this link, we build a novel workers’ protection measure based on 36 labor law variables over a sample of 70 developed and developing countries from 1970 to 2010. Exploiting a dynamic panel setting using both internal and external instruments, we establish a new result: immigration impacts workers’ protection in the direction of the origin country workers’ protection (composition channel), while we find a small negative or null effect for the immigrant population (size channel). The composition channel, or the law transfer effect, is particularly strong for two components of the workers’ protection measure: worker representation laws and employment forms laws. Our results are consistent with suggestive evidence on transmission of preferences from migrants to their offspring (vertical transmission), and from migrants to natives or local political parties (horizontal transmission). Finally, calculations based on the estimated coefficients suggest that immigration, on average, contributes to a reduction in workers’ protection, particularly in OECD high-income countries.

Migrants' Self-Selection and the Vicious Circle of Right-Wing Populism

F. Docquier, C. Vasilakis
Preliminary version (abstract available only)

We test whether the level of right-wing populism in a given country influences the size and skill composition of its immigration and emigration flows. To do so, we use an instrumental variable approach, where we instrument variations in right-wing populism using a combination of collective memory, represented by the average vote share of right-wing parties between 1900 and 1950, and trigger variables, such as economic insecurity shocks. Our results show that an increase in right-wing populism leads to a decrease in the inflow of college-educated migrants, and this relationship is twice as strong as the effect on the inflow of low-skilled migrants. We also find that right-wing populism leads to an increase in high-skilled emigration, while leaving low-skilled emigration unaffected. These effects are not necessarily associated with the election of a populist government or a hardening of migration policies, suggesting that migration decisions are likely influenced by the political climate and voter attitudes. As a result, right-wing populism tends to lower the average educational attainment of both immigrants and left-behind voters, which helps explain the persistence and snowballing effect of right-wing populism despite its proven negative impact on the economy.

Digging Up Trenches: Populism, Selective Mobility & the Political Polarization of Italian Municipalities

L. Bellodi, F. Docquier, S. Iandolo, M. Morelli, R. Turati
IZA DP No. 16732, CEPR DP 18778, LISER DP2024-01

We study the effect of local exposure to populism on net population movements by citizenship status, gender, age and education level in the context of Italian municipalities. We present two research designs to estimate the causal effect of populist attitudes and policies. Initially, we use a combination of collective memory and trigger variables as an instrument for the variation in populist vote shares across national elections. Subsequently, we apply a regression discontinuity design to estimate the effect of electing a populist mayor on population movements. We find three converging results. First, the exposure to both populist attitudes and policies, as manifested by the vote share of populist parties in national elections or the close-election of a new populist mayor, reduces the attractiveness of municipalities and leads to larger population outflows. Second, the effect is particularly pronounced for young, female, and highly educated natives, who tend to move across Italian municipalities rather than internationally. Third, we find no effect on the foreign population. Our results highlight  a foot-voting mechanism that may contribute to a political polarization in Italian municipalities.

Populist leaders and international migration

E. Bacher
Preliminary version (abstract available only)

Immigration is often considered as an important cause of populism, but the reverse causality between immigration and populism has received much less attention. In this paper, we use data on populist leaders and bilateral migration flows since 1960 to explore the effect of populism on immigration. Using several variants of synthetic control method, we find that having a populist leader significantly decreases the growth rate of immigration, in particular for low-skilled immigration. We then use the DEMIG policy dataset to explore the mechanisms behind those results. We find that populist leaders implement a much higher number of restrictive immigration policies than other leaders and that these policies often target low-skilled migrants. This implies that the decrease in high-skilled immigration flows is due to a lower attractiveness because of the populist leader.

Local Exposure to Immigration and Populist Votes: Evidence from Polling Districts in the City of Milan

F. Docquier, A. Levai, E. Murard, E. Peluso, H. Rapoport
Work in progress

Policy briefs

Populism and the Skill Content of Globalization

F. Docquier, S. Iandolo, H. Rapoport, R. Turati, G. Vannoorenberghe
VoxEU, 12 Mar 2024.

Democracies in Danger: How Can We Break the Vicious Circle of Populism?

F. Docquier, M. Morelli, E. Peluso
LISER Policy Brief 2022-05

Immigration and Populism

The Ukrainian Exodus Calls for Better Coordination in the European Asylum Policy

L. Guichard, J. Machado, J-F. Maystadt
LISER Policy Brief 2022-04 

Ukrainian Refugee Crisis Tests Luxembourg’s Humanitarian and Integration Policy

M. Beine, F. Docquier, J. Machado, B. Nienaber, A. Sommarribas.
Research Luxembourg - Policy Brief (May 2022)

EUFIRST Events

EUFIRST Workshop on 


“Migration and Politics: Current and Future Challenges”


13-14 October 2023 

In Caglio, near Lake Como




LISER, in collaboration with leading researchers from the Bocconi University and Università Cattolica del Sacro Cuore in Milan, are organizing this workshop , serving as a component of the EUFIRST project. Scientific committee: Massimo Bordignon, Frédéric Docquier, Massimo Morelli, Eugenio Peluso, and Hillel Rapoport. The workshop will take place in the Town Hall of the charming village of Caglio (Lombardy, Italy).



Program available here.

20th IMISCOE Annual Conference

3-6 July 2023 (in Warsaw)


Frederic Docquier will deliver a keynote lecture titled "Democracies in Danger: Selective Migration and the Vicious Circle of Populism" during the 20th IMISCOE Annual Conference. This significant event, focusing on "Migration and Inequalities: In search of answers and solutions," will feature the presentation as part of the Opening Plenary, themed "Inequalities as one of the key challenges for the 21st century."


Moreover, a comprehensive presentation on the same topic served as a keynote lecture during the Junior Workshop on Economics of Migration. The workshop, held in Paris on June 15-16, 2023, was a collaborative effort by renowned institutions such as CERDI, PSE, LISER, the University of Luxembourg, Universidad Carlos III, CEPII, and the IC Migrations.


Political Economy of Open Borders: Theory and Evidence on the Role of Electoral Rules

Special seminar: 21 March 2023 (LISER conference room)

As part of  the EUFIRST project, the Living Conditions Dpt. and Crossing Borders Prog. at LISER organized a special seminar with Massimo Morelli (Bocconi U.) on the “The Political Economy of Open Borders Theory and Evidence on the role of Electoral Rules” (joint work with M. Gamalerio,and M. Negri).


Abstract: Institutions matter for the political choice of policies. We study, theoretically and empirically, how different electoral systems affect the immigration policy of a country or city. We show that electoral systems where parties need the absolute majority of the votes to gain control of the decision-making power are weakly more open to immigration than those where a plurality of the votes is sufficient. There is evidence for this result at all levels in terms of  correlations, and we establish causality via RDD for the Italian case.

EEA-ESEM Congress 2022 - Session on Globalization and Populism

22-26 August2022 at Bocconi University

The EUFIRST team organized a contributed session on "Globalization and Populism" at the EEA-ESEM Congress 2022. The session was organized and chaired by our team member, Prof. Riccardo Turati (UAB). It included four presentations, two of which are part of our research outcomes:

Roundtable: Russia's Invasion of Ukraine and the Ukrainian Refugee Crisis

24 March 2022 at the Chamber of Commerce (Kirchberg)

The conflict in Ukraine has resulted in a significant influx of Ukrainian refugees in EU countries. While there has been a notable display of solidarity, this large-scale flow poses significant challenges in terms of reception and integration. To better frame these challenges, LISER organized a roundtable discussion that brought together scholars, field experts, and policymakers. The objective of this roundtable was to raise awareness and enhance understanding of the implications this situation has for both EU countries and Luxembourg. 

EUFIRST Workshop on Globalization, Attitudes and Populism

23-24 March 2022 at LISER

The workshop dealt with the causes and consequences of populism and sanction votes, their links with perceptions of inequality and cultural threats, trade and immigration shocks.