Journal Article

Indication of Economic Populism in Local Governance: A New Approach for Classifying Populist Behaviour

Fuka, Jan, Pernica, Bohuslav, Zdražil, Pavel, Baťa, Robert

2025

Overview

Purpose: The extant literature on populism posits that populists frequently find themselves at odds with the neoliberal economic paradigm, as evidenced by rising debt, a public-investment deficit, and substantial deficit-financed government spending. Populist decision-making is characterised by short-termism and can, therefore, be distinguished from non-populist governance through economic variables. This study introduces an innovative quantitative approach that analyses local-government financial data to classify populist economic behaviour.Design/Methodology/Approach: Adhering to the scholarly consensus that short-termism is a fundamental indication of populism, we operationalise economic populism with five financial variables, scrutinised using cointegration analysis and a probabilistic approach. The selected variables are grounded in the literature on economic populism. The underlying data are publicly available for Czechia—the country examined— and for many other states. We verify the methodology by analysing governing coalitions in major municipalities.Findings: Examination of 6,240 municipalities in post-communist Czechia between 2002 and 2021 reveals indications of economic populism in 6.2 % of cases. Result verification shows that these municipalities are frequently governed by populist parties or varied local initiatives, rather than by established non-populist parties.Academic contribution to the field: This study employs an innovative quantitative assessment of financial indicators, diverging from mainstream populism research, which is usually based on qualitative assessment of sources such as statements, narratives and historical context. Moreover, it emphasises the local level of government in the study of economic populism—a phenomenon typically assessed at the centralgovernment level.Research implications/limitations: The findings suggest that populism may represent a strategic approach for certain local governments, particularly in smaller towns and villages where limited fiscal discipline can impede development. Some identified financial patterns may stem from incompetence or lack of expertise rather than intentional populism. Additionally, many municipalities in the sample are governed by a ‘grey zone’ of local initiatives, complicating result verification. Because the methodology is novel at the local level, there are virtually no comparable studies; consequently, our findings are considered alongside various Central European studies on populism.Originality/Value: This study develops an original quantitative approach applicable at the local-government level to analyse extensive datasets. It enriches discourse on economic populism by examining the phenomenon through the lens of short-termism in financial data. Namen: Literatura o populizmu navaja, da so populisti pogosto v konfliktu z neoliberalno gospodarsko paradigmo, kar se kaže v čedalje večjem dolgu, naložbenem primanjkljaju in znatni javni porabi, ki se financira iz primanjkljaja. Odločitve populistov zaznamuje  kratkoročna usmerjenost. Zato jih lahko od nepopulističnega upravljanja ločimo z gospodarskimispremenljivkami. Pri študiji gre ta inovativen kvantitativni pristop, ki analizira finančne podatke lokalnih oblasti za razvrščanje gospodarskega populističnega vedenja.Zasnova/metodologija/pristop: V skladu z znanstvenim konsenzom, da je kratkoročnost temeljni pokazatelj populizma, operacionaliziramo gospodarski populizem s petimi finančnimi spremenljivkami, ki jih preučujemo s kointegracijsko analizo in verjetnostnim pristopom. Izbrane spremenljivke temeljijo na literaturi o gospodarskem populizmu. Podatki so javno dostopni za Češko republiko, ki je primer proučevane države, terza številne druge države. Metodologijo preverjamo z analizo koalicij, ki vladajo v večjih občinah.Ugotovitve: Analiza 6.240 občin v postkomunistični Češki med letoma 2002 in 2021 razkriva znake gospodarskega populizma v 6,2 odstotka primerov. Preverjanje rezultatov kaže, da te občine pogosto vodijo populistične stranke ali raznolike lokalne iniciative, namesto uveljavljenihnepopulističnih strank.Znanstveni prispevek: Študija uvaja inovativen kvantitativni pristop k ocenjevanju finančnih kazalnikov in se oddaljuje od prevladujočih raziskav populizma, ki večinoma temeljijo na kvalitativnih virih, kot so izjave,narativi in zgodovinski kontekst. Poleg tega v ospredje postavlja lokalno raven upravljanja pri proučevanju gospodarskega populizma. Gre za pojav, ki ga običajno analiziramo na ravni centralne oblasti.Praktične omejitve in implikacije raziskave: Rezultati nakazujejo, da je lahko populizem strateški pristop za nekatere lokalne skupnosti, zlasti v manjših mestih in vaseh, kjer pomanjkanje fiskalne discipline ovira razvoj.Nekateri zaznani finančni vzorci so lahko posledica nesposobnosti ali pomanjkanja strokovnega znanja, ne nujno namernega populizma. Številne občine v vzorcu vodi »siva cona« lokalnih iniciativ, kar otežuje preverjanje rezultatov. Ker je metodologija na lokalni ravni novost, skoraj ni primerljivih študij; zato rezultate primerjamo z različnimi srednjeevropskimi raziskavami o populizmu.Izvirnost/vrednost: Raziskava razvije izviren kvantitativni pristop, ki ga je mogoče uporabiti na ravni lokalne samouprave za analizo obsežnih podatkovnihnizov. Bogati razpravo o gospodarskem populizmu, saj pojav preučuje skozi prizmo kratkoročnosti v finančnih podatkih.

• Publisher: University of Ljubljana, Faculty of Administration, Journal Uprava/Administration,University of Ljubljana Press (Založba Univerze v Ljubljani)
• Subject: Academic disciplines / Cities / Communism / Data / Decision making / Deficits / Economic behavior / Economic development / Economic policy / economic populism, short-termism, local governance, financial data, Czechia / Economic theory / Governance / Government spending / Innovations / Local government / Neoliberalism / Novels / Politics / Populism / Postcommunist societies / Public debt / Public finance / Public sector / Public services / Quantitative analysis / Research methodology / Variables / Verification / Villages