Populism, Identity and Illiberal Behaviour

Abstract

Since the expression 'illiberal democracy' was coined by Fareed Zakaria, a host of scholars and commentators have drawn our attention to the recent rise of populist illiberalism and increased authoritarianism; for example, Dani Rodrik.

The trend towards mainly right-wing populism is a common characteristic of developed countries that are already established democracies; the authoritarian feature is mainly ascribable to developing countries. A liberal society is one where there is respect for minority rights, constraints on the executive (and legislature), with an independent judiciary, and there is respect for the rule of law. In a democracy, there is an electoral process in place.

A purely electoral process may elect populist dictators or parties with scant respect for liberalism. The tyranny of the majority may engender illiberal actions, as described by classical liberals (John Stuart Mill; Alexis de Tocqueville). Additionally, populist leaders (referred to as demagogues in Aristotle’s Politics) can cause the degeneration of the polity. The two phenomena that promote populism are hyper-globalization and the consequent rise in inequality. I outline a theoretical model how identity based behaviour can be manipulated via the actions of political entrepreneurs.

The model is applicable to a stylized developing country society that is beset with ethnic cleavages. These cleavages can be worsened or improved by the actions of political entrepreneurs who can influence individual behaviour via the mechanism of meme messages. Under certain circumstances the meme messages are more effective and can even become viral.

In the model the median individual who is decisive in an electoral process belongs to the majority group but has below mean income. This individual is poor; his utility is derived both from identity based behaviour, his group’s relative income or place within society and .his own income. Standard neoclassical economics traditionally ignores the first two aforementioned aspects of an individual’s utility. In some circumstances, this individual can be convinced by meme messaging to act against his pecuniary interests, hence violating the neoclassical tenet of homo economicus to engage in identity based behaviour.

Growing inequality, political developments and a mismanaged society can drive this type of individual to place identity over interests. In other environments the messaging and activities of the political elite can heal ethnic cleavages. Aid can play a role in this by easing the budget constraints of the political entrepreneurs.