Monday, 18 March 2019

Financial crisis and right-wing extremism in Germany, 1931-33

a column by Sebastian Doerr, José-Luis Peydró and Hans-Joachim Voth for VOX: CEPR’s Policy Portal

Polarised politics in the wake of financial crises echo throughout modern history, but evidence of a causal link between economic downturns and populism is limited.

This column shows that financial crisis-induced misery boosted far right-wing voting in interwar Germany. In towns and cities where many firms were exposed to failing banks, Nazi votes surged. In particular, places exposed to the one bank led by a Jewish chairman registered particularly strong increases of support – scapegoating Jews was easier with seemingly damning evidence of their negative influence.

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