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Make America poor again:
Populists like Donald Trump have a fatal influence on their country's economic strength
Photo: Alexi J. Rosenfeld / AFP / Getty Images
Populists are currently in power in more than a quarter of all countries worldwide. What long-term consequences does their regime have for the national economy? Three scientists from the Kiel Institute for the World Economy investigated this question. In their analysis, they examined the consequences of the rule of 51 populist rulers from 1900 to 2020 - from Mussolini and Hitler to Perón to Kaczyński and Trump.
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They found that the economic costs of populism are enormous: 15 years after a populist came to power, his country's gross domestic product (GDP) was on average 10 percent lower than in a comparable state not governed by populists. The decline usually began two to three years after coming to power.
“In the medium and long term, virtually all countries governed by populists experience subpar economic performance – evidenced by significant declines in real GDP and consumption,” the authors write. Their research brought one key result: “Populist leaders are bad for the economy.”
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Source:
Manuel Funke et al.: “Populist Leaders and the Economy”, American Economic Review, December 2023