Sunday, September 9, 2018

Inside the Sweden Election Results

The Sweden election results are mostly in and here are the most salient points.
* The social democrats did a bit better than the polls indicated that they would. But their 28.4 percent performance was still historically bad and about 3 points down from the last election in 2014.
* The Sweden Democrats, the far-right populist party, which some feared would surge enough to become the country's second largest--or even largest--party, somewhat underperformed their pre-election polls. However, their 17.6 percent of the vote was still almost 5 points up from their 2014 performance, so they were the election's big winners.
* The overall center-left bloc (social democrats, greens, Left party) did very slightly better than the center-right bloc (Moderate party, Centre party, Liberal party, Christian Democrats). Current results show 40.6 percent of the vote and 144 parliamentary seats for the center-left bloc to 40.3 percent of the vote and 142 seats for the center-right bloc.
It is not yet clear what government will form based on these results. But, in theory, the other parties have committed to not including the Sweden Democrats in government, so whatever government forms will not include them.
The big question everyone is asking is: where did the Sweden Democrats come from? Who supports them and why? Since the Sweden Democrats are very hard-line on immigrants and immigration, as are similar European right populist parties, the dominant interpretation has tended to be that supporters of the Sweden Democrats are simply reacting in a racist and xenophobic way to the arrival of people who are different from them. Sweden is doing well economically so economic factors couldn't possibly have anything to do with it. (Sound familiar?)
A terrific paper published right before the election casts considerable doubt on this interpretation and provides a compelling alternative. This is one of the best papers I have seen on European right populism--I strongly recommend it.
The paper is Economic Losers and Political Winners: Sweden's Radical Right by Ernesto Dal Bo, Frederico Finan, Olle Folke,
Torsten Persson, and Johanna Rickne. Their basic approach and argument, including a plausible interaction between economic changes and immigration issues:
First and foremost, our study sheds new light on how economic shocks may explain the rise of the radical right. We start from the timing of the Sweden-Democrat rise: growing to enter parliament between 2006 and 2010, and continuing to become Sweden’s third largest party in 2014 (with a 12.9 percent vote share). This period pre-dated the 2015 refugee crisis, but coincided with two events that worsened the relative economic lot for large segments of the population. In 2006, a Center-Right coalition of parties took power and implemented a dramatic reform agenda of tax cuts and social-insurance austerity with the purpose to “make work pay”. Over a mere six years, these reforms triggered a dramatic increase in income inequality. With earned income tax credits, incomes continued to grow among “insiders” with stable employment, while spending cuts implied a stagnation of disposable incomes for “outsiders” with unstable or no jobs. The second key event is the 2008 financial crisis. The crisis increased the job insecurity for “vulnerable insiders”, segments of the population with stable employment, but with jobs at higher risk of replacement by automation and other forms of rationalization than “secure insiders”….
We find that the groups which faced a relative-income decline and higher job insecurity are over-represented among the politicians and voters of the radical right. Politicians from the Sweden Democrats include more outsiders and vulnerable insiders, compared to both the population and, very starkly, other political parties. Over-representation also grows across sub-groups of labor-market outsiders the more they lost (relative to insiders) from the make-work-pay reforms. For voters, we find a strong positive correlation between the Sweden Democrats’ electoral success and the impact of the economic reforms and the financial crisis (i) across municipalities and (ii) across voting districts within municipalities….
One may legitimately ask why new politicians and voters who suffered economic shocks turned to the radical right, rather than the Swedish Left party or the Social Democrats, parties which have traditionally favored redistributive policies and job security (e.g., Guiso et al. 2017). The suggested answer from our analysis is that the political left offers a slate of politicians skewed away from labor market outsiders and vulnerable insiders towards secure insiders….
Our analysis does not show a link between direct exposure to immigration and support for the radical right. The 2002-2014 rise of the Sweden Democrats coincides with a higher tolerance for immigration of the average Swede. The divergent anti-immigration attitudes between insiders and outsiders are also weaker than the divergent trust in government institutions. This does not preclude an instrumental role of anti-immigration rhetoric in the party’s electoral success. With diminished trust in established parties, taking a stand so clearly at odds with the inclusive values of the traditional political class signals an uncompromising opposition to the establishment, which complements the credibility attained by citizen candidates.
Moreover, we could easily think of an indirect link from economic outcomes to attitudes on immigration, and/or the salience of immigration policy in voting decisions. Perhaps most importantly, economic pressures may make people more receptive toward political messages that emphasize the fiscal costs of immigration and the latent redistribution from foreign to native-born by restricting it. Economic shocks could also lead low-income natives away from a social identification with class and support for redistribution, towards an identification with the nation and support for tax cuts and restricted immigration, even at a utility cost (Shayo 2009). Similarly, disgruntled economic losers may socially identify more strongly with their own in-group. If these voters put the blame for their predicament on out-groups, they may be attracted by a party that is anti-establishment as well as anti-immigration. Other explanations along similar lines posit that a long-standing, latent, anti-immigrant stance may interact with economic shocks to drive populist voting (Gidron and Hall 2017).
An equally important, though separate, topic to discuss is the long-term social decline of the white, middle or working-class man, often with short education. This population segment is the backbone of radical right voters, both in Sweden and elsewhere. In the Swedish case, these demographic segments were more likely to suffer from the economic events that we study. We show, however, that the strong relationships of voting and political candidacy remain after flexibly controlling for gender, education, and industrial sector. All in all, our results are compatible with an understanding that both long-term and short-term socioeconomic decline matters, and that short-term economic decline can be a trigger event for so-called “latent” voting segments that have more nostalgia for the past (Norris and Inglehart 2018).
Huffington Post has published an OK short summary of the paper but I strongly recommend diving into the whole thing.
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A new study challenges the conventional wisdom that nativist politicians are gaining ground simply because countries like Sweden now have more foreigners.

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