For Better, for Worse? Public Support for the Capitalist Model of the Economy

Abstract:     
Does public support for the economic model, rise if the economy prospers and drop in times of a downturn? Or is the support largely independent of the ups and downs of economic cycles? A capitalist economy is based on several elements, such as private ownership and competition. We hypothesize that persons profiting from the capitalist economic system are more supportive of the systems constitutive elements. Using multilevel regression I study the effects of economic developments. The findings indicate that in particular macro-economic factors matter for individual level attitudes towards the economy. The findings largely support the basic hypothesis. A range of individual level features – education and personal economic stakes – affects attitudes towards the economy. Most interesting are the substantial differences in how persons from the opposing ends of the political spectrum perceive the economy and economic developments. While people on the Left are largely unaffected in their skeptical evaluation of capitalism by economic developments in how they view the economy, the positive attitudes of persons from the Right receive a strong boost, if the economy prospers.

Number of Pages in PDF File: 28

Keywords: Economic Development, Support for Capitalism, Economic System, Economic Crisis

JEL Classification: H11, O1, P10, P17

working papers series