Why Austerity? The Mass Politics of a Contested Policy

91 Pages Posted: 25 Nov 2019 Last revised: 23 Oct 2020

See all articles by Kirk Bansak

Kirk Bansak

University of California, San Diego

Michael M. Bechtel

Washington University in St. Louis

Yotam Margalit

Tel Aviv University

Date Written: November 13, 2019

Abstract

The merits of austerity in response to financial crises are widely contested and assumed to cause significant electoral backlash. Nonetheless, governments routinely adopt austerity when confronting economic downturns and swelling deficits. We explore this puzzle by distinguishing public acceptance of austerity as a general approach and support for specific austerity packages. Using original survey data from five European countries, we show that austerity is in fact the preferred response among most voters. We develop potential explanations for this surprising preference, and demonstrate the empirical limitations of accounts centered on economic interests or an intuitive framing advantage. Instead, we show that the preference for austerity is highly sensitive to its political backers and precise composition of spending cuts and tax hikes. Using a novel approach to estimate support for historical austerity programs, we contend that governments' strategic crafting of policy packages is a key factor underlying the support for austerity.

Keywords: austerity, economic crises, public opinion, policy design, redistribution, public spending, taxes, budegt deficit, self-interest, policy preferences, survey, ideology, randomized experiment, conjoint, partisanship

JEL Classification: G01, H12, H51, H61, P16

Suggested Citation

Bansak, Kirk and Bechtel, Michael M. and Margalit, Yotam, Why Austerity? The Mass Politics of a Contested Policy (November 13, 2019). Available at SSRN: https://ssrn.com/abstract=3486227 or http://dx.doi.org/10.2139/ssrn.3486227

Kirk Bansak

University of California, San Diego ( email )

9500 Gilman Drive
La Jolla, CA 92093
United States

Michael M. Bechtel (Contact Author)

Washington University in St. Louis ( email )

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

Yotam Margalit

Tel Aviv University ( email )

Tel Aviv
Israel

HOME PAGE: http://www.ymargalit.net

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