Brexit in 2019 and the banking crisis in 2007 to 2009 are usually seen as unrelated events. This column argues that they are in fact closely connected. The austerity policies embarked on in response to the fiscal damage resulting from the banking crisis triggered the protest votes of left-behind voters, which at the margin allowed Leave to win the referendum vote. The implication is that the economic costs of the banking crisis are much larger than is usually supposed.
Politics and economics
Despite public concerns about the role and influence of big donors on politics, questions remain regarding the mechanisms behind political favouritism to donor corporations. Using 2006–2014 data on political donations and public procurement allocations in the Czech Republic, this column finds that firms that increase their donations to a political party see the value of their public procurement contracts rise in the following year. Contracting authorities appear to engage in different forms of strategic behaviour to favour corporate donors, who tend to face fewer competitors in more regulated and open procurement procedures.
It blows the minds of economists when voters choose protectionist policies that, they point out, make most of them poorer. Gene Grossman tells Tim Phillips how trade models can explain this, if they incorporate insights from other social sciences.
Unanimous agreement on the UK’s Brexit question is clearly not going to be achievable. But as this column argues, using a sequential voting system, it is within reach to structure the democratic process so that a voting procedure is fair to all views and the outcome is preferred by a majority to any other alternatives.
The claim by populist leaders to have a monopoly on representing ‘the people’ stands in contrast with the concept of liberal democracy, which is based on pluralism where different groups represent different interests and values. Using data from several waves of the European Social Survey, this column demonstrates that individuals who belong to associations are less likely to vote for populist parties. Alexis de Tocqueville appears to have been right when he wrote almost two centuries ago that civil society is a key defence of liberal democracy.
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15 - 15 March 2019 / London, Royal Society / UK Network of Environmental Economists (UKNEE)
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