Beware populist economics
https://www.ft.com/content/727d4bbc-7966-4ae9-b890-ac0883069ef8
History suggests the political approach ends in unsustainable debt and lower GDP.
Fear the deficit-populism doom loop
https://www.economist.com/finance-and-economics/2025/08/24/fear-the-deficit-populism-doom-loop
Politicians, particularly in Europe, are in a terrible bind.
https://www.ft.com/content/727d4bbc-7966-4ae9-b890-ac0883069ef8
History suggests the political approach ends in unsustainable debt and lower GDP.
Fear the deficit-populism doom loop
https://www.economist.com/finance-and-economics/2025/08/24/fear-the-deficit-populism-doom-loop
Politicians, particularly in Europe, are in a terrible bind.
Funke, Manuel, Moritz Schularick, and Christoph Trebesch. 2023. "Populist Leaders and the Economy." American Economic Review 113 (12): 3249–88.
Abstract
Populism at the country level is at an all-time high, with more than 25 percent of nations currently governed by populists. How do economies perform under populist leaders? We build a new long-run cross-country database to study the macroeconomic history of populism. We identify 51 populist presidents and prime ministers from 1900 to 2020 and show that the economic cost of populism is high. After 15 years, GDP per capita is 10 percent lower compared to a plausible nonpopulist counterfactual. Economic disintegration, decreasing macroeconomic stability, and the erosion of institutions typically go hand in hand with populist rule.
Abstract
Populism at the country level is at an all-time high, with more than 25 percent of nations currently governed by populists. How do economies perform under populist leaders? We build a new long-run cross-country database to study the macroeconomic history of populism. We identify 51 populist presidents and prime ministers from 1900 to 2020 and show that the economic cost of populism is high. After 15 years, GDP per capita is 10 percent lower compared to a plausible nonpopulist counterfactual. Economic disintegration, decreasing macroeconomic stability, and the erosion of institutions typically go hand in hand with populist rule.