Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/308099 
Year of Publication: 
2024
Series/Report no.: 
Kiel Working Paper No. 2278
Publisher: 
Kiel Institute for the World Economy (IfW Kiel), Kiel
Abstract: 
We study the political consequences of inflation surprises, focusing on votes for extremist and populist parties in 365 elections in 18 advanced economies since 1948. Inflation surprises are regularly followed by a substantial increase in vote shares of extremist, anti-system, and populist parties. An inflation surprise of 10 percentage points leads to a 15% increase in their vote share, comparable to the increase typically seen after financial crises. We show that the change in voting behavior is particularly pronounced when real wages decline, and less evident when real wages are not affected. Our paper points to considerable political after-effects of unexpected inflation.
Subjects: 
Inflation
Economic Voting
Extremism
Populism
Radicalization
JEL: 
D72
E31
N40
N10
Document Type: 
Working Paper

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