Scandinavian Working Papers in Economics

Umeå Economic Studies,
Umeå University, Department of Economics

No 978: Globalization, Time-Preferences, and Populist Voting

Thomas Aronsson (), Clemens Hetschko () and Ronnie Schöb ()
Additional contact information
Thomas Aronsson: Department of Economics, Umeå University, Postal: Department of Economics, Umeå University, S 901 87 Umeå, Sweden
Clemens Hetschko: University of Leeds and CESifo, Munich, Postal: University of Leeds, Economics Division, Maurice Keyworth Building, Leeds LS2 9JT, United Kingdom
Ronnie Schöb: Freie Universität Berlin and CESifo, Postal: School of Business & Economics, Freie Universität Berlin, Boltzmannstraße 20, D–14195 Berlin

Abstract: Societies see growing support for populist politicians who advocate an end to globalization. Our behavioral economics model links impatience to voters’ appraisals of an income shock due to globalization that is associated with short-run costs and delayed gains. The model shows that impatient individuals may reject further globalization if they are subject to borrowing constraints. Using German data, we confirm that impatient voters choose right-wing antiglobalist parties. Similarly, we show for the United Kingdom that a preference for immediate gratification increases the support for right-wing anti-globalist parties as well as for Brexit. A policy implication of our study is that governments may use up-front redistribution to gain voters’ support for further globalization.

Keywords: Globalization; time-preference; impatience; time-inconsistency; populism; Brexit; up-front redistribution

JEL-codes: D15; D72; D91; F15; F61; F68; H53

63 pages, July 22, 2020

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