Populist Leaders and the Economy
American Economic Review (Forthcoming)
Populism at the country level is at an all-time high, with more than
25% 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% lower compared to a plausible
non-populist counterfactual. Economic disintegration, decreasing
macroeconomic stability, and the erosion of institutions typically
go hand in hand with populist rule.