Policy Design and Domestic Support for International Bailouts

44 Pages Posted: 19 Oct 2012 Last revised: 15 Dec 2015

Michael M. Bechtel

Washington University in Saint Louis

Jens Hainmueller

Stanford University - Department of Political Science; Stanford Graduate School of Business; Stanford Immigration Policy Lab

Yotam M. Margalit

Columbia University

Date Written: December 2015

Abstract

Financial bailouts for ailing Eurozone countries face deep and widespread opposition among voters in donor countries, casting major doubts over the political feasibility of further assistance efforts. What is the nature of the opposition and under what conditions can governments obtain broader political support for funding such large-scale, international transfers? Addressing this question, we distinguish theoretically between 'fundamental' versus 'contingent' attitudes. Whereas the former entail complete rejection or embrace of a policy, contingent attitudes depend on the specific features of the policy and could shift if those features are altered. Combining unique data from an original survey in Germany, the largest donor country, together with an experiment that varies salient policy dimensions, our analysis indicates that less than a quarter of the public exhibits fundamental opposition to the bailouts. Testing a set of theories on contingent attitudes, we find particular sensitivity to the burden-sharing and cost dimensions of the bailouts. Our results imply that the choice of specific policy features has important consequences for building domestic support for contributions to international assistance efforts.

Keywords: bailouts, Eurozone, public opinion, conjoint analysis

JEL Classification: F5, P16, F34, D72

Suggested Citation

Bechtel, Michael M. and Hainmueller, Jens and Margalit, Yotam M., Policy Design and Domestic Support for International Bailouts (December 2015). Available at SSRN: https://ssrn.com/abstract=2163594 or http://dx.doi.org/10.2139/ssrn.2163594

Michael M. Bechtel

Washington University in Saint Louis ( email )

Campus Box 1063
One Brookings Drive
Saint Louis, MO 63130-4899
United States

Jens Hainmueller (Contact Author)

Stanford University - Department of Political Science ( email )

Stanford, CA 94305
United States

HOME PAGE: http://www.stanford.edu/~jhain/

Stanford Graduate School of Business ( email )

655 Knight Way
Stanford, CA 94305-5015
United States

Stanford Immigration Policy Lab

30 Alta Road
Stanford, CA 94305
United States

Yotam M. Margalit

Columbia University ( email )

3022 Broadway
New York, NY 10027
United States

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