Redistributive preferences: Why actual income is ultimately more important than perceived income

An emerging consensus claims that ‘subjective’ (mis)perceptions of income inequality better explain redistributive preferences than actual ‘objective’ conditions. In this article, we critically re-assess this view. We compare perceived and actual income positions as predictors for preferences for redistribution. We argue that perceived income is partly endogenous to actual income and its effect on preferences conditional on ideology. Using an original survey experiment from Switzerland, we show that the predictive power of perceived income is lower compared to actual income. Perceived income is only associated with redistribution preferences among centre-right respondents, but not among left-wing respondents. Furthermore, providing respondents with corrective information about their true position in the income hierarchy has no effect on redistribution preferences. These findings go against the new consensus about the superior explanatory power of subjective perceptions of income inequality. We argue instead that absolute objective conditions should be at the centre of explaining redistributive preferences

Muting Science: Input Overload Versus Scientific Advice in Swiss Policy Making During the Covid‐19 Pandemic

This article explores why the Swiss Federal Council and the Swiss Federal Parliament were reluctant to follow the majority views of the scientific epidemiological community at the beginning of the second wave of the Covid-19 pandemic. We propose an institutionalist take on this question and argue that one major explanation could be the input overload that is characteristic of the Swiss federal political system. We define input overload as the simultaneous inputs of corporatist, pluralist, federalist and direct democratic subsystems. Adding another major input—this time from the scientific subsystem—may have threatened to further erode the government's and parliament's discretionary power to cope with the pandemic. We assume that the federal government reduced its input overload by fending off scientific advice

Austerity and Adjustment from the Great Recession to the Pandemic— and Beyond

In 2010–2015 almost all democratic countries pursued austerity. Then countries exited austerity, although following different paths. The onset of the pandemic brought about a hike in public spending to cope with its social and economic consequences that does, however, plant the seeds of future economic adjustments. In this chapter we study the political strategies and options of governments during austerity periods using a new dataset for 30 democratic nations, from 2010 to 2019. We ask where and when democratic politics mattered for austerity policies from the Great Recession to the Covid-19 pandemic. Our main finding is that austerity policies were mostly driven by economic forces. Focusing on the process of exiting austerity, we show that such policies cannot be sufficiently explained by changed economic fundamentals. Rather, the longer governments pursue austerity the more likely they are to exit it, even if the economic fundamentals do not support it

Switzerland Report : Sustainable Governance in the Context of the COVID-19 Crisis

Switzerland was one of the first European countries to be affected by the coronavirus pandemic. As with other countries that were affected early, Switzerland took longer to respond than countries that were affected later (Kohler et al. 2020; Wenger et al. 2020), because there were no best practice examples to copy (Plümper and Neumayer 2020). Measured in terms of controlling the coronavirus incidence rate (average number of new infections per 100,000 inhabitants), the country’s response to the first wave of the coronavirus pandemic and its aftermath (March – April 2020) was extraordinarily successful. However, its response to the second wave, which began in late August and reached its preliminary peak in November 2020, was significantly poorer. During the first wave, Switzerland pursued a strict, time-consistent lockdown policy. However, the country’s approach to the second wave was hesitant, less strict and less time-consistent, with various temporary, light lockdowns pursued. In particular, during the first wave, efficient and pragmatic economic policies were implemented, including a light-handed lending program managed by private banks and fully guaranteed for loan defaults by the federal government, while a generous short-time work compensation program and several à fonds perdu payments (hardship cases) were introduced by cantonal and federal governments. At the end of the period under review, Switzerland’s economic growth, government deficit and unemployment rates appeared to have been relatively unaffected. This was due to very favorable conditions at the start of the coronavirus pandemic, namely Switzerland’s highly competitive economy, booming and flexible labor market, efficient infrastructure, reliable public administration, and sound public finances. In addition, the government recently enacted an ordinance regulating lockdown measures within the framework of the Swiss Epidemics Act (EpA 2012). By international standards, democracy in Switzerland has functioned well, and few restrictions have been placed on civil liberties and rights. As a federal state with a weak federal government due to sovereignty residing mainly in the cantons, policy responses to the coronavirus crisis involved complex coordination between cantons, and between cantons and the federal level. Consequently, policymaking was prone to conflict, slow and idiosyncratic, while policy actors were incentivized to avoid blame for policy failures. Policymaking has been strongly path dependent. With the exception of the emergency law period (“exceptional situation”), which increased federal government powers over the cantons, federal economic policy has been coordinated with cantonal policies and worked to a large extent by matching funds. The need for negotiations and compromise in policy formulation resulted in a sluggish process that ultimately delivered relatively inconsistent policies. Corporatist coordination between the state and economic actors continued to be highly effectively. The major achievement was the introduction of a program that entitled struggling firms to request credit from private banks, which would be guaranteed in case of default by the federal government. This program was designed and implemented within a few days by representatives of five major banks together with the Federal Ministry of Finance, and demonstrates the extent of mutual trust and familiarity between the banks and the ministry as well as the country’s pragmatic heterodox economic ideology. Beyond corporatist cooperation, economic interest groups (in particular small- and medium-sized enterprises) were highly successful in achieving their goals, provided there was no opposition from other economic elites or liberal counterparts of industry in the political systems. For example, representatives of the hospitality industry successfully lobbied to remove lockdown restrictions on hotels and restaurants earlier than planned during the first wave (Sager and Mavrot, 2020). However, their demands for a rent reduction program to support hotels and restaurants during the lockdown failed, as the proposal provoked opposition from economic-liberal politicians and other interest groups (e.g., landlords). Path dependence characterized the likelihood of interest groups’ success. While well-organized producer interests (particularly associations of employers and firm owners) could carry the day, weakly organized groups and employees were much less successful. It was only in December 2020 that short-time work compensation for low-wage employees was increased, as requested by trade unions. Meanwhile, the demands of nursing personnel for better working conditions were rejected by parliament in the fall of 2020. Finally, during the coronavirus pandemic, tensions between expert scientific advice and political decision-making became pronounced. It took several weeks following the start of the coronavirus pandemic for the Federal Council to institutionalize a scientific task force, and when it was formed it was composed mainly of life scientists and economists (with sociologists, psychologists and political scientists poorly represented). Scientific advice has been treated as one among many inputs and some politicians – in particular from the right-populist Swiss People’s Party – have made it clear that they do not appreciate scientific input into political decision-making

Voices from the past:Economic and political vulnerabilities in the making of Next Generation EU

In this article, we show that Next Generation EU (NGEU) is mainly a response to the economic and political imbalances left over from the Eurozone crisis. It is a pre-emptive intervention, especially targeted at structurally weak economies with rising Euroscepticism, to avoid costly ex-post bailouts as in the Great Recession. We demonstrate, using quantitative analysis, that pre-existing vulnerabilities, rather than the impact of the pandemic, drove the allocation of NGEU resources: per capita grants largely correspond to past economic vulnerabilities, as well as to political ones. Countries most vulnerable to another adjustment by austerity after the COVID-19 economic crisis receive most resources. Also, countries with strong anti-EU sentiments are entitled to larger NGEU grants per capita. In contrast, grants are not correlated with the severity of the health crisis. Then, we show the domestic relevance of economic and political vulnerabilities through qualitative case studies of national political debates and domestic positions on NGEU in Italy, Germany and the Netherlands. Despite its innovative traits, NGEU is a politically constrained solution to address the mess from the previous decade, and as such, it is a Janus solution: promising a fresh start, but haunted by the past

Divided but united:explaining nested public support for European integration

<p>Academic and general interest in public support for European Integration is on the rise. Theoretically, the utilitarian, identity, reference, cue-taking and signalling models have been developed to explain this perplexing phenomenon. While these models have been tested, there is no comprehensive up-to-date account of how well they perform separately, relative to each other and across levels. Empirically, this study utilises a data set with 110,873 respondents from the European Social Survey. Methodologically, a multilevel model is used to address causal heterogeneity between levels. The study shows that ‘attitudes towards multiculturalism’ at the individual level and ‘corruption’ at the country level are the strongest predictors. When interacting levels within models, it is demonstrated that individual trust in the national political establishment is being moderated by the level of corruption in a country in influencing support for European integration. On this basis, two models are proposed, named the ‘saviour model’ and the ‘anti-establishment model’.</p