the electoral consequences of two great crises

The electoral consequences of two great crises

JOHANNES LINDVALLDepartment of Political Science, Lund University, Sweden

Abstract. Who benefits from deep economic crises: the left, the right or neither? On the basis of evidencefrom elections in 1929–1933 and 2008–2013 in all states that were democracies in both periods, it is arguedin this article that the electoral consequences of the Great Depression and the Great Recession weresurprisingly similar: in both periods, right-wing parties were at first more successful than left-wing parties,although this effect only lasted for a few years. The manner in which a crisis develops over time should betaken into account when examining the effects of deep economic downturns on the electoral fortunes of theleft and the right.

Keywords: economic crises; economic voting; electoral behavior; Great Depression; Great Recession

This article is concerned with the electoral fortunes of parties on the left and on the rightduring two global financial and economic crises: the Great Depression, which began in 1929,and the Great Recession, which began in 2008. A comparison of democratic elections inthese two great crises is not only of historical interest; it also offers us a new opportunity toexamine the relationship between economic downturns and election outcomes. I ask twoquestions. First, were the electoral consequences of the Great Recession similar to theelectoral consequences of the Great Depression? Second, who benefited from these twocrises: the left, the right or neither? My answer to the first question is a qualified ‘yes’. Myanswer to the second question is that both in the 1930s and in the 2000s, right-wing partieswere initially more successful than left-wing parties, but this effect only lasted for a fewyears.

There is no settled answer to the question of whether deep economic downturns, such asthe Great Depression and the Great Recession, benefit the left or the right. Scholars ofcomparative politics have typically argued that in countries that remained democratic, theGreat Depression contributed to the rise of left-of-centre parties (social democratic partiesin Europe, the Democratic Party in the United States). Analyses of postwar public opiniondata, on the other hand, often suggest that the right – not the left – benefits from economicdecline.The literature on economic voting, finally, suggests that when times are hard, voterssimply turn against the incumbent government, whatever its ideological composition.

This article examines the first post-crisis elections in 1929–1933 and 2008–2013 in allstates that were democracies in both periods. It then extends the Great Recession sampleto all Organisation for Economic Cooperation and Development (OECD) countries witha population of more than half a million. The main innovation is the idea that the mannerin which an economic crisis develops over time should be taken into account when exam-ining the effects of deep economic downturns on the electoral fortunes of the left andthe right. The next section explains why the electoral effects of deep economic crises arelikely to change as such crises develop. The ensuing sections present empirical evidence

European Journal of Political Research 53: 747–765, 2014 747doi: 10.1111/1475-6765.12055

© 2014 European Consortium for Political ResearchPublished by John Wiley & Sons Ltd

suggesting that this indeed happened in both the Great Depression and the Great Reces-sion: at first, these crises appear to have benefited the right; then the left started to do better.

Elections in hard times

There is no doubt that major economic events such as the Great Depression and the GreatRecession have important political consequences; the question is: What are those conse-quences? This section discusses three hypotheses that can be derived from the scholarlyliterature: the swing-to-the-left hypothesis, according to which deep economic crises benefitthe left; the swing-to-the-right hypothesis, according to which deep economic crises benefitthe right; and the punishment hypothesis, according to which deep economic crises hurtgoverning parties (or governing coalitions).The evidence for the latter hypothesis is strong:there is little doubt that incumbents tend to lose votes in economic downturns. Beyond this,however, surprisingly little is known about the effects of deep economic crises on thesupport for left-wing and right-wing parties. My own view is that there are good reasons toexpect an initial swing to the right after a big economic shock, but I do not expect it to lastmore than a few years.

The swing-to-the-left hypothesis

One of the standard accounts of the Great Depression era is that the economic crisis of the1930s resulted in the ascendancy of left-wing parties in countries that remained democratic(many countries, of course, descended into right-wing authoritarianism in this period).1

Most prominently, Gourevitch (1984, 1986: Chapter 4) has credited the Great Depressionwith forging centre-left ‘red-green coalitions’ between workers and farmers, such as theNew Deal coalition in the United States (which resulted in many years of Democraticdominance in Congress) and the Cow Trade between the Social Democrats and theFarmers’ Party in Sweden (which solidified the power of the Social Democrats, who went onto govern Sweden for more than four decades). Berman (2006) has even argued that of thethree main ideologies of the interwar years – laissez-faire liberalism, social democracy andfascism – social democracy was the one that eventually triumphed.

We do not have to go back to the 1930s to find support for the idea that a deep economiccrisis should favour the left. One example is the recent study by Broz (2013: 75, 77), whoargues that financial crises persuade voters to ‘reassess their support for right-leaninggovernments’ and that the electorate ‘tends to move to the left’ after such a crisis. Foranother example, consider Wright (2012), who shows that the Democratic Party in theUnited States tends to do better when unemployment is high. Wright’s explanation for thispattern is that the Democratic Party ‘owns’ the issue of unemployment. If this finding canbe generalised to other countries, economic crises that result in high unemployment shouldfavour centre-left parties.

The swing-to-the-right hypothesis

Whereas the main claim of the comparative political economy literature on the GreatDepression is that the crisis of the 1930s led to a centre-left breakthrough in countries that

748 JOHANNES LINDVALL

© 2014 European Consortium for Political Research

remained democratic, the main message of the literature on political behaviour in thepostwar period is that economic decline favours the right.

One of the first scholars to make this claim wasAlt,who concluded,in his study of economicdecline in the United Kingdom, that economic distress makes the policy preferences of mostvoters less ‘altruistic’, rendering the political climate less hospitable for left-wing parties (Alt1979: 223–226, Chapter 14). Durr (1993: 167) has shown, similarly, that voters in the UnitedStates tend to become more liberal in good times and more conservative in bad times.Stevenson (2001:632) has extended Durr’s argument cross-nationally, reaching the conclusionthat‘a good economy pushes policy mood to the left while a poor one pushes it to the right’,andshowing that this finding applies across the advanced democracies. Stevenson (2001: 622n)added the important hypothesis that this pattern might be a result of voters regarding thepolicies of the left as ‘luxury goods’ that cannot be afforded in hard times.

Many studies of economic voting also suggest,at least indirectly, that a deep economic crisisshould hurt the left more than the right, for scholars of economic voting have long argued thatleft-wing incumbents are hurt more by unemployment and right-wing governments are hurtmore by inflation (Hibbs 1977, 1982; Powell & Whitten 1993; Weatherford 1978; Whitten &Palmer 1999).2 Since deep economic crises such as the Great Depression and the GreatRecession are typically associated with low growth and high unemployment, but not withinflation (the Great Depression and the Great Recession were deflationary crises), thisliterature suggests that on balance, left-wing incumbents should suffer more in such crises.

The punishment hypothesis

According to this hypothesis, voters simply lash out against those in power during a deepeconomic downturn, punishing the incumbent government. The claim that incumbents losemore votes in hard times than they do in good times is the basic idea of the rich literatureon economic voting.3 But there are also studies of economic voting that deal specificallywith the Great Depression and the Great Recession. In two related papers on electoralresponses to these two crises, Achen and Bartels (2005) and Bartels (2014) have foundconsiderable support for what the latter calls a ‘rather simple model of retrospectivevoting’. In these studies, citizens simply rewarded or punished incumbent governmentsbased on growth rates before each national election. Kriesi’s (2014) work on Europeanelections in the Great Recession reaches similar conclusions.4

Right and back again

There is thus strong evidence for the punishment hypothesis, both in the general literatureon economic voting and in studies of the Great Depression and the Great Recessionspecifically. But there is no necessary contradiction between the punishment hypothesis, onthe one hand, and the two other hypotheses, on the other, so it remains important to addressthe question of why the literature on the Great Depression suggests that the crisis of the1930s led to a swing to the left when studies of postwar public opinion data typically suggestthat economic downturns result in a swing to the right.

There are a number of possible explanations for this discrepancy – the levels of analysisvary across these literatures, and so do the dependent variables – but I will concentrate on

THE ELECTORAL CONSEQUENCES OF TWO GREAT CRISES 749


one particular explanation: whereas the literature on the Great Depression is concernedwith events taking place over several years, most studies of the effects of economic down-turns on political attitudes and preferences are concerned with short-term effects (up to ayear). This difference is important since there is reason to expect the political situation atthe beginning of a global economic crisis to be different from the later phases of such a crisis.

In the beginning of a deep economic crisis, voters in the middle of the income distribu-tion are not likely to be personally affected (they are not the first to become unemployed,for instance), which means that the kinds of mechanisms that Alt, Durr and Stevenson haveemphasised are likely to matter a great deal: knowing that an economic downturn increasesthe demand for social protection and redistribution for the groups who suffer the most,pivotal voters may well become less ‘altruistic’, as Alt claims, or think of left-of-centrepolicies as ‘luxury goods’, as Stevenson argues. Indeed, there is some evidence of such apattern in recent work on the Great Recession. Margalit (2013), who examines social policypreferences in the United States during the first years of the Great Recession, concludesthat the crisis had an ‘uneven impact’, resulting in a

bifurcation in sentiment between the narrower constituency who personally experi-enced a major economic setback and the broader population that did not. Whereassupport for greater government spending on welfare assistance increased among theformer, it actually decreased among the rest of the population. (Margalit 2013: 99)

Over time,however,the negative consequences of a deep and prolonged crisis often affecta greater proportion of the electorate, either directly or indirectly (cf. Kenworthy & Owens2011: 217–218). This arguably makes the formation of centre-left electoral alliances andgoverning coalitions more likely (including the sorts of cross-class coalitions that Gourevitchand others identified in the 1930s). For this part of the argument, finding supportingindividual-level evidence is less straightforward – the current crisis will be a good test casewhen data on long-term developments in public opinion in crisis-ridden countries becomesavailable – but the logic of many political economy models is consistent with my attempt toreconcile the swing-to-the-left hypothesis and the swing-to-the-right hypothesis. Forexample, Lupu and Pontusson (2011) have argued that centre-left political alliances becomemore likely when the shape of the income distribution makes the interests of middle-incomevoters more aligned with the interests of the poor and less aligned with those of the rich.Thatis arguably how a prolonged economic crisis influences political preferences:when economicvulnerability begins to be felt across income groups (low and middle), and across socialclasses (workers and farmers, for instance), the left is likely to do better.

On the basis of these arguments, I expect the following pattern in both the GreatDepression and the Great Recession: first, a swing to the right; then, a level playing-field, oreven a swing to the left.

Research design and data

The aim of this article is to examine and compare the electoral consequences of the twogreatest global economic crises of the past one hundred years: the Great Depression and



the Great Recession. There are two reasons to engage in such an endeavour. The first is thehistorical importance of these two events. The second is that the comparison between thetwo crises offers us a new opportunity to learn about the political effects of economicdownturns.

The main point of the research design in the article is that the Great Depression and theGreat Recession had a number of things in common. Both crises emerged in the UnitedStates and later spread to Europe, and both began as financial crises but later turned intofull-blown macroeconomic crises. Other significant economic crises – such as the drawn-outeconomic crisis that began in the early 1970s (the ‘Great Inflation’) – do not share thesecharacteristics. Many scholars and political commentators have commented on the similar-ities between these two events. For example, DeLong and Eichengreen (2012) observe thatthe parallels between Europe in the 1930s and Europe today are ‘stark, striking, andincreasingly frightening’, both economically and politically.

The main limitation of the research design is that the analysis is based on a small numberof elections. Only 20 countries were democracies when the Great Depression began andheld at least one democratic election between the Wall Street Crash and the Second WorldWar (Marshall & Jaggers 2011). These countries had become 21 by the time of the GreatRecession, due to the break-up of Czechoslovakia, and in some analyses, I expand thesample by including all 32 OECD countries with a population of more than half a million.The fact remains that the samples are small; it is important to keep this in mind wheninterpreting the results.

Periods and countries

The beginning of the Great Depression and the beginning of the Great Recession arecommonly associated with two events: the Great Wall Street Crash in late October 1929,and the bankruptcy of the American investment bank Lehman Brothers on 15 September2008. In order to identify the political consequences of the Great Depression and the GreatRecession, I examine the ‘swing’ from left to right (or right to left) in the first nationallegislative elections in each country in the sample after 24 October 1929 (‘Black Thursday’– the first large fall in stock prices on the New York Stock Exchange) and 15 September2008.

Treating the dates of the Great Wall Street Crash and the Lehman Brothers Collapse asstarting points is slightly arbitrary since different countries were affected by the GreatDepression and the Great Recession at different points in time. But it is hard to come upwith better starting points. Bordo and James (2010) argue that the closest Great Depressionparallel to the Lehman Brothers collapse is not the Great Wall Street Crash, but thebankruptcy of the Austrian bank Creditanstalt in May 1931. For the purposes of this article,however, the Wall Street Crash is arguably a better starting point since the internationalrecession that followed the Crash reached most democratic countries in 1929–1930 – wellbefore the Creditanstalt event (Romer 1993: 20–21).

According to data from the Polity Project (Marshall & Jaggers 2011), 20 states weredemocracies in 1929 (using a Polity score of six or higher as the cut-off point): Australia,Austria, Belgium, Canada, Costa Rica, Czechoslovakia, Denmark, Estonia, France,Germany, Greece, Ireland, Latvia, the Netherlands, New Zealand, Norway, Sweden,



Switzerland, the United Kingdom and the United States. In some of the analyses of theGreat Recession, I extend the sample to all OECD countries with a population of morethan half a million (adding Chile, Finland, Hungary, Israel, Italy, Japan, Mexico, Poland,Portugal, Slovenia, South Korea, Spain and Turkey to the original sample, but excludingCosta Rica and Latvia since they are not OECD members). In order to measure the swingconsistently and to achieve maximum comparability between the 1929–1933 and 2008–2013samples, I only examine the first post-crash election in each country.

Measuring election results

The empirical analyses are concerned with the change in support for parties on the left andparties on the right between the last pre-crisis election and the first election after the GreatWall Street Crash (in 1929–1933) and after the Lehman Brothers Collapse (in 2008–2013).

The change in left-party support between the last pre-crash election and the firstpost-crash election, ΔLeft, is defined as the difference between the combined support forparties on the left in the election under observation and the combined support for partieson the left in the previous election (in percentage points). I count green and left-libertarianparties as left-wing parties since such parties almost exclusively support left-of-centregovernments. The change in right-party support, ΔRight, is defined in the same manner. Icount fascist parties (in the 1930s) and right-wing populist parties (in the 2000s) as right-wing parties since fascist parties in the 1930s opposed communist and social democraticparties and since right-wing populist parties in the 2000s have almost exclusively supportedright-of-centre governments. On the basis of these two variables, I define the main depend-ent variable, Swing to the Right, as ΔRight − ΔLeft. Positive values represent swings to theright. Negative values represent swings to the left.

The dependent variable in this study is different from the dependent variable in studiesof economic voting, which is typically a measure of support for the incumbent party orparties. As Wright (2012: 691–692) notes, the dependent variable in studies of the effect ofeconomic factors on voting should be chosen on the basis of the hypothesis that is beingtested, and for a study that is primarily designed to examine broad ideological shifts, not totest reward-punishment hypotheses, the Swing to the Right variable is arguably moresuitable than a measure of incumbent support.

I am not aware of any publicly available dataset that combines information about theoutcomes of democratic elections in the pre-Second World War period with informationabout party ideologies. It has therefore been necessary to create a new dataset, which hasbeen compiled from a number of different sources. In order to calculate the swing from leftto right in each national election, all significant political parties that have been classifiedideologically, distinguishing between parties on the left (social democratic, communist,green or left-libertarian), centrist parties (secular or Christian democratic) and parties onthe right (conservative, market-liberal, fascist or right-wing populist). All parties that arerepresented in the Swank (2006) dataset of postwar parties (or are predecessors or succes-sors of those parties) have been categorised accordingly, unless the party’s ideology hasobviously changed over time. Parties that are not represented in Swank (2006), but arerepresented in Döring and Manow (2010) have been coded accordingly (translating thecategories used in Döring and Manow to the categories used by Swank). In the remaining



cases, where the ideological orientation is not obvious from the party’s name, the catego-risation is based on country-specific sources.5

The meanings of the terms ‘left’ and ‘right’ changed between the 1930s and the 2000s,and the policies that left- and right-wing parties pursue today are clearly very different fromthe policies that left- and right-wing parties pursued 80 years ago. Yet today’s left- andright-wing parties are often the direct descendants of parties that existed in the 1930s, andthe relative positions of left- and right-wing parties in national party systems have beenfairly stable, which arguably makes it meaningful to compare the fortunes of parties on theleft and parties on the right in the two historical periods under examination.

Explanatory variables

The variable Years Since Crash (or simply Years) is defined as the time (in years andfractions of years) that had passed since 24 October 1929 (for 1930s elections) or 15September 2008 (for 2000s elections).

The variable Incumbent, which measures the ideological orientation of the incumbentparty or parties, ranges from −1 to 1 and can take five values: −1 for single-party left-winggovernments; −0.5 for coalition governments where the largest party is a left-wing party; 0for centrist governments, nonpartisan governments or ideologically mixed coalition gov-ernments; 0.5 for coalition governments where the largest party is a right-wing party; and 1for single-party right-wing governments (the coding is similar to the coding of the govern-ment ideology variable in Bartels (2014)).

Data on Growth for the 1930s are based on annual gross domestic product (GDP)estimates from Maddison (2011:missing Estonia and Latvia).Data for the 2000s are based onquarterly, seasonally adjusted GDP estimates from the OECD (2013), except for data forCosta Rica and Latvia, which are based on annual GDP estimates from the World Bank(2011) and Eurostat (2011). In the Great Depression dataset, the variable Growth is definedas the annual growth rate (in per cent) in the election year (for elections held in the autumn)or as the annual growth rate in the year before the election (for elections held in the spring).In the 2000s dataset, for which more detailed data are available, Growth is defined as theincrease in GDP per capita in the year leading up to the quarter of the election, except in theCosta Rican and Latvian cases, for which Growth is defined in the same way as in the 1930s.

Elections in hard times

Figure 1 provides details on the change in right-party support, compared to the last pre-crash elections, in the first legislative elections after the Great Wall Street Crash or theLehman Brothers Collapse.There were important similarities between the first years of theGreat Depression and the first years of the Great Recession: for some two-and-a-half yearsafter both the Great Wall Street Crash and the collapse of Lehman Brothers, right-wingparties did better, on average, than they had done in the previous election, but after this firstphase, right-wing parties were more likely to do badly than to do well. The solid trend linesdescribe how the expected change in support for parties on the right varied over time in thecountries that were democracies already in the 1930s (the countries in this smaller sample



of old democracies are represented by circles). The dotted trend line in Figure 1b describeshow the expected change in support for parties on the right varied over time in theextended sample of 32 OECD member states.

Figure 2 provides details on changes in left-party support. As the figure shows, there areimportant similarities between the 1930s and the 2000s if we only consider the countries thatwere democracies in the 1930s: in both periods, left parties lost some support, on average,

(a) Great Depression

(b) Great Recession

Figure 1. Change in right-party support.



where elections were held soon after the beginning of the Great Depression or the GreatRecession, but left parties did better later on (the expected change in left-party supportbecomes approximately zero after two to three years). When extending the analysis of theGreat Recession period to the whole OECD, however, the (dotted) trend line becomesalmost flat and close to y = 0, suggesting that on average, the electoral fortunes of parties onthe left in the full sample of OECD countries were not affected by the Great Recession.


(b) Great Recession

Figure 2. Change in left-party support.



Figure 3 combines the data presented in Figures 1 and 2 into a single measure of the‘swing’ to the right. In both periods, there was, on average, a swing to the right in earlyelections, but this advantage disappeared after two to three years. There is a slight differ-ence, in Figure 3b, between the main sample of 21 old democracies and the extended sampleof 32 OECD countries, but overall, the patterns are fairly similar across samples.


(b) Great Recession

Figure 3. Swing from left to right.



The median swing to the right in the first 30 months after the Wall Street Crash was 5.5percentage points (Table 1); in elections held later than that, the median swing was 4.7percentage points to the left. The only democratic country where the right did really badlyin the first two-and-a-half years of the Great Depression was New Zealand (although theincumbent right-wing government stayed in power). In many countries, there was a signifi-cant swing to the right: the Liberals in Canada and the socialist or social democratic partiesin Australia, Germany, Ireland, Norway and the United Kingdom all suffered significantlosses. From mid-1932 onward, however, centre-left parties did well: in May 1932 a coalitionof left parties won the French parliamentary election, the Social Democrats won in Swedenin September, and the Democrats took over both houses of the United States Congress inNovember (this election is not included in the figures since the first election in the UnitedStates after the Wall Street Crash was the 1930 midterm election).

In the Great Recession, the median swing to the right in the first 30 months after thecollapse of Lehman Brothers was 3.7 percentage points in the small sample of 21 democ-racies and 5.5 percentage points in the larger sample of 32 OECD countries; in electionsheld later than that, the median swing was 6.7 percentage points to the left. Countries witha relatively large swing to the right in elections held soon after the Lehman BrothersCollapse included Austria, the Czech Republic, Costa Rica, Hungary, Israel, the Nether-lands, New Zealand, Portugal, Sweden and the United Kingdom.A few years into the GreatRecession, however, parties on the left managed to defeat incumbent right-wing govern-ments in Ireland, where the more centrist Fine Gael and the Irish Labour Party defeatedthe Fianna Fáil; in Denmark, where the Liberal-Conservative government was defeated bya centre-left coalition led by the Social Democrats; in France, where the left did well in theelection to the National Assembly that followed the presidential election victory ofFrançois Hollande; and in Italy, where the right-wing parties that had supported SilvioBerlusconi’s government after the election of 2007 suffered large losses. The only countrieswhere right-wing parties did much better than left-wing parties after the first two-and-a-halfyears of the Great Recession were Finland (due to the large increase in support for theright-wing populist True Finns party) and Spain, where the Socialist government wasdefeated.

Analysis

In this section, I present simple statistical analyses that are designed to explore the patternsin Figure 3 further, and to test whether these patterns are simply a reflection of retrospec-tive economic voting.

Table 1. Median swings to the right in the first post-crash elections

First post-crisis election held . . . . . . in first 30 months . . . after 30 months

Great Depression 5.5 −4.7

Great Recession 3.7 −6.7

Great Recession (OECD) 5.5 −6.7



Table 2 analyzes election outcomes in the wake of the Great Depression.The first modelonly has the ideological orientation of the incumbent government on the right-hand side ofthe equation.The large and negative coefficient for Incumbent shows that the government’sideological orientation mattered greatly to election outcomes in the early 1930s: where aleft-wing party was in power during the Great Depression, there was an expected swing tothe right, and vice versa. The fact that the constant term is positive means that on average,right-wing parties did slightly better than left-wing parties. But the standard error is large.

Model (2) adds a measure of the time since the Great Wall Street Crash, allowing theexpected swing to vary over time. Judging from the root mean square error, this model hasa better fit than the first model, suggesting that it is meaningful to include the time variablein the analysis.The constant term, which can now be interpreted as the expected swing whenthe variable Incumbent equals zero and the election was held on the day of the Wall StreetCrash, is larger in this model than in model (1), suggesting that there was a relatively largeexpected swing to the right in elections held soon after the crash, but not in later elections(the expected swing falls over time).

Model (3) adds a measure of Growth and the interaction term Incumbent × Growth.With respect to the baseline swing and the time variable, the results are consistent withmodel (2); in fact, both the constant term and the coefficient for the time variable havelarger magnitudes and are estimated with more precision. Holding growth and the ideo-logical orientation of the government constant, there was thus a relatively large expectedswing to the right in early elections, but after a little more than two years, this effect wasneutralised (and in elections held even later, the model predicts a swing to the left). Theonly difference between models (3) and (2) is that in the former the marginal effect of theideological orientation of the incumbent government is conditional on the rate of growthprior to the election.

I will have more to say about substantive effects below (see Figure 4). For now, I onlynote that the implication of the best-fitting model – model (3) – is that when both theincumbency variable and the growth variable are held at zero, an election held one year into

Table 2. Elections in 1929–1933: Main results (OLS coefficients, standard errors)

Including Czechoslovakia Excluding Czechoslovakia

(1) (2) (3) (4) (5) (6)

Constant (baselineswing)

2.5 (2.5) 10.5* (5.9) 11.0* (5.7) 3.1 (2.6) 18.5** (6.4) 19.8*** (6.0)

Incumbent −8.7* (4.8) −9.9** (4.7) 2.0 (6.9) −9.0* (4.8) −11.8** (4.3) −0.6 (6.0)

Years since Wall StreetCrash

−3.9 (2.6) −5.2* (2.5) −7.1** (2.8) −8.3*** (2.5)

Growth −0.6 (0.6) −0.3 (0.5)

Incumbent x Growth 2.2** (0.9) 2.0** (0.8)

Observations 20 20 18 19 19 17

Root mean squareerror

10.8 10.4 9.9 10.8 9.4 8.4

Note: * p < 0.10; ** p < 0.05; *** p < 0.01.



the Great Depression is predicted to have resulted in a 5.8 percentage point swing to theright, but an election held after three years is predicted to have resulted in a 4.6 percentagepoint swing to the left (for the confidence intervals around these and all other predictedswings, see Figure 4).

It is important to remember that the results are based on a very small sample ofelections. This means that individual observations may have powerful effects on the results.The most influential observation by far in models (1)–(3), as measured by Cook’s distance,is Czechoslovakia. There are strong reasons to exclude Czechoslovakia from the analysissince the 1929 parliamentary election there was held one day after the first fall in stockprices on the New York Stock Exchange, and only the most well-informed voters wouldhave been affected by this news from the United States. In models (4)–(6), the Czechoslo-vakian election has been left out. The magnitudes of the estimated baseline swing (theconstant term) and the coefficient for the time variable Years are now significantly larger.

All things considered, I would therefore suggest that a combination of the punishmenthypothesis and the qualified partisan hypothesis that I have proposed – an initial swing tothe right, then a level playing-field or even a swing to the left – best explains electionoutcomes during the Great Depression.

Great Depression, all democracies Great Depression,Czechoslovakia excluded

Great Recession, 1930s sample Great Recession, OECD sample

Figure 4. Predicted swings.Notes: The figure describes the predicted swings to the right when the control variables (the ideologicalorientation of the incumbent government and the level of growth) are held at 0. Specifically, the figure plotsthe sum of the constant term and the coefficient for the Years variable multiplied by the number of yearssince the beginning of the crisis, based on the results of models (3), (6), (9) and (12) in Tables 2 and 3. Onlythe in-sample range of the Years variable is included. The lighter grey areas are the 95 per cent confidenceintervals around the estimated swings. The darker grey areas are the 90 per cent confidence intervals.



I will now proceed to consider evidence on elections in the Great Recession, beginningwith the 21 countries in the main sample (Table 3). The main thing to note about models(7)–(9) is that the results are strikingly similar to the results in Table 1.The main differencesconcern the interaction term Incumbent × Growth, which is now less precisely estimated,and the stand-alone incumbency variable in model (9), which remains significantly negative,suggesting that zero growth was not enough, in the Great Recession, to preserve the levelof electoral support for parties that were ideologically similar to the governing parties.Model (9) implies that, all else being equal, the predicted swing to the right for an electionheld one year after the collapse of Lehman Brothers was approximately 6.3 percentagepoints, which is close to the result for the 1930s (5.8 percentage points). An election heldafter three years is predicted to have resulted in a 5.3 percentage points swing to the left,which is again similar to the result for the 1930s.

Models (10)–(12) in Table 3 include all OECD countries with a population of more thanhalf a million. The most important differences between these results and the previousresults involve the constant term – the expected swing to the right when all variables areheld at zero – which is estimated with more precision than in some of the earlier models,whereas the time variable (the rate at which the expected swing to the right diminishes overtime) is smaller and estimated with less precision. Nevertheless, the implications of model(12) for elections held soon after the Lehman Brothers Collapse are similar to those ofmodel (9): all else being equal, the model predicts a 6.3 percentage-point swing to the rightone year into the crisis. But where model (9) predicted a swing to the left after three years,model (12) only predicts that left-wing parties will catch up after three years (the predictedswing after three years is close to zero).

The other difference between model (12), on the one hand, and models (3), (6) and (9),on the other, is that the coefficient for the interaction term in model (12) is, for all practical

Table 3. Elections in 2008–2013: Main results (OLS coefficients, standard errors)

1930s sample OECD countries

(7) (8) (9) (10) (11) (12)

Constant(baselineswing)

3.6 (2.5) 9.5* (4.6) 12.1*** (4.1) 4.9** (2.1) 9.0** (3.6) 9.3** (3.8)

Incumbent −9.4** (4.0) −8.5** (3.9) −8.7** (3.6) −10.7*** (3.0) −10.1*** (3.0) −9.8*** (3.1)

Years sinceLehmanBrothers

−3.7 (2.4) −5.8** (2.3) −2.4 (1.7) −3.0 (1.9)

Growth 1.0 (0.8) 0.7 (0.8)

Incumbent xGrowth

2.0 (1.4) −0.2 (1.1)

Observations 21 21 21 32 32 32

Root meansquare error

11.4 11.0 9.6 11.6 11.4 11.6

Note: * p < 0.10; ** p < 0.05; *** p < 0.01.



purposes, zero. In the wider OECD sample, the extent to which parties with an ideologicalprofile similar to the government’s lost votes thus did not depend on recent growth.Although this finding is slightly surprising, it actually resembles a finding by Kriesi (2014),who found that whereas recent growth mattered greatly to the vote share of incumbents inthe older, established democracies in Western Europe in the wake of the Great Recession,it did not in the newer Central and Eastern European democracies.

In sum, extending the analysis of the Great Recession period from the smaller sample ofcountries that were democracies at the time of the Great Depression to the whole of theOECD leads to slightly different results; but for all samples, combining the punishmenthypothesis with the qualified partisan hypothesis that I have proposed seems to explainelection outcomes better than the punishment hypothesis alone.

For an illustration of the implications of the four fully specified models – (3), (6), (9) and(12) – see Figure 4, which plots predicted swings to the right over the in-sample ranges ofthe variable Years.All models predict a swing to the right during the first two or three yearsafter each crash. With the exception of Figure 4a, which includes the influential outlier ofCzechoslovakia, the estimated swing to the right in the initial period is statistically differentfrom zero for the first 18–24 months (in Figure 4a, the estimated swing is distinct from zeroat the p < 0.10 level for a period of six months).6

The political effects of economic crises

This article is one of the very first attempts to compare systematically the electoral conse-quences of the Great Depression and the Great Recession. The evidence that I havepresented suggests that with respect to overall swings from left to right (and vice versa), theelectoral consequences of the Great Depression and the Great Recession were surprisinglysimilar. The descriptive patterns in Figures 1b–3b (the Great Recession) largely resemblethe patterns in Figures 1a–3a (the Great Depression). Also, Tables 2 and 3 show that thesame simple models can account for a significant part of the variation in election outcomesin both periods. Furthermore, most of the coefficients in Table 3 have the same signs as thecorresponding coefficients in Table 2, and the magnitudes and standard errors of thesecoefficients are also comparable. Powerful retrospective economic voting mechanisms wereat work in both the 1930s and 2000s: where left-wing parties were in power when thesecrises occurred, right-wing parties were likely to do well, and vice versa. However, thepattern that I have found – an expected swing to the right in early elections – cannot beexplained by economic voting alone. My interpretation is that voters make their decisionson the basis of both retrospective and prospective evaluations. Clearly, incumbent govern-ments are punished when times are hard, but there also seems to have been a prospective,ideological mechanism at work during the Great Recession and the Great Depression.

What does the comparison between the Great Depression and the Great Recession tellus about the political effects of economic downturns in general? My answer to this questionis more cautious, for this article investigates a small sample of elections (20 elections in theGreat Depression, 21–32 elections in the Great Recession). It is also important to keep inmind that whereas the Great Depression and the Great Recession were events of historicimportance, they were also unusual events; until the results have been corroborated in other



studies, it is not possible to say whether we should always expect a swing to the right in theimmediate aftermath of a large economic shock (followed by a swing back to the left if theshock results in a prolonged economic crisis).

There are several possible ways to subject this idea to further empirical scrutiny. Oneoption is to identify deep economic downturns and financial crises on a country-by-countrybasis (as in Broz (2013), which draws on Reinhart & Rogoff (2009)) to check if the samepattern can be observed if we shift the perspective from global to domestic crises. Anotheroption is to develop datasets that allow for systematic, inter-temporal comparisons betweeneconomic downturns (whether international or country-specific) and between economicdownturns, on the one hand, and periods of relative stability and growth, on the other. Athird possibility is to move from country-level to individual-level analyses to find out if thecausal mechanisms that I have posited here can be observed at the level of the individualvoter.

The comparison between the Great Depression and the Great Recession does providepreliminary evidence for the argument of this article. The idea that elections held in thebeginning of a deep economic crisis should, on average, result in a swing to the right,whereas elections held a few years into a deep crisis should result in no swing (or even aswing to the left) finds more support here than the simple swing-to-the-left and swing-to-the-right hypotheses that I discussed early in the article. This serves as a reminder that therelationship between economic downturns and election outcomes is not yet well-understood. As I pointed out in the introduction, the comparative literature on the GreatDepression suggests that an economic crisis should lead to a swing to the left, whereas moststudies of postwar public opinion data suggest that economic downturns typically result ina swing to the right. This article suggests a way of reconciling these two important ideas.

Acknowledgements

I am grateful to Alvina Erman and Carl Gahnberg for excellent research assistance. I amalso grateful to Larry Bartels, Sebastian Dellepiane, Stefano Palombarini, MichaelWahman, Robert Östling, three anonymous reviewers and the editors for their commentson earlier drafts. I received very valuable comments from participants at the 2011 and 2012CES conferences and from participants in seminars in Gothenburg, Lund, Oxford andParis. Klaus Armingeon, Varvara Lalioti, Iván Molina and Espen Olsen offered much-needed advice on the Swiss, Greek, Costa Rican and Norwegian party systems. This projectreceived generous financial support from the Swedish Research Council.

Supporting Information

Additional Supporting Information may be found in the online version of this article at thepublisher’s web-site:

Table S1. Elections in 1929–1933: Descriptive DataTable S2. Elections in 2008–2013: Descriptive Data



Table S3. Analyses of Pooled Dataset (OLS coeffcients, standard errors)Table S4. Using ΔLeft as Dependent Variable (OLS coeffcients, standard errors)Table S5. Using ΔRight as Dependent Variable (OLS coeffcients, standard errors)

Notes

1. Indeed, of the 20 democratic states included in the parts of this study that are concerned with electionsin the early 1930s, five (Austria, Estonia, Germany, Greece and Latvia) had become authoritarian beforethe middle of the decade.

2. Using individual-level data on European elections, Van der Brug et al. (2007: 99–102) find a morecomplex pattern, where the effects of growth, inflation and unemployment also depend on the size ofparties. For a recent study of the responsiveness of different income groups to changes in unemploymentand inflation in the United Kingdom in the Great Recession, see Palmer and Whitten (2011).

3. For recent contributions to this literature, see Lewis-Beck (1988); Powell and Whitten (1993); Andersonet al. (2004); Van der Brug et al. (2007); Duch and Stevenson (2008). On economic voting in the GreatRecession, see especially the contributions to the recent symposium on ‘Economics and Elections’ inElectoral Studies 32(3).

4. See also Bermeo and Bartels (2014) and the chapter by Soroka and Wlezien in the same volume (Soroka& Wlezien 2014), both of which argue that the Great Recession had only minor effects on left-rightpublic opinion. On economic voting in the Weimar Republic in the early 1930s, see Frey and Weck (1983)and King et al. (2008).

5. Electoral data for the late 1920s and early 1930s come from Mackie and Rose (1974), Flora et al. (1983),Nohlen (2005), and Nohlen and Stöver (2010). Electoral data for the 2000s come from online sources(Carr 2011; Álvarez Rivera 2011). For the classification of party ideologies it has sometimes beennecessary to resort to country-specific sources, such as Von Rauch (1974), Mavrogordatos (1983),Lehoucq and Molina (2002: Chapter 5), Bundestag (2006) and King et al. (2008), and on personalcommunication with scholars familiar with the countries in question.

6. In supplementary material that is available via the EJPR website, I include a pooled analysis where theGreat Depression sample and the Great Recession sample are combined into one. Substantively,the results are similar to those reported in the article. By including interactions between a dummy for theGreat Recession sample and all the variables in the model, I also test for parameter stability across thetwo samples. The coefficients for the interaction terms are statistically insignificant, individually andjointly, suggesting that the parameters are reasonably stable. The supplementary materials also includemodels where changes in right-party support and left-party support are analyzed separately. Theseanalyses suggest that most of the results reported in the article are driven by what happened toright-wing parties; the results for left-party support are consistent with the argument, but less significant,substantively and statistically.

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Address for correspondence: Johannes Lindvall, Department of Political Science, Lund University, Box 52,22100 Lund, Sweden. E-mail: [email protected].



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