3 Quarks Daily: Populism in Less Developed Countries

Populism comes in many forms. For economists, populism represents the allure of short-term fixes that cause long-term damage; in political science, the term represents strong leaders wiling to dispense with the rule of law or minority rights. Populism of developing countries has its own traits, attracting educated, middle class and urban citizens as opposed to the uneducated, rural and working-class people snared in wealthy nations. Populism in wealthy countries often emphasizes separation from government while developing countries favor strong, centralized leadership. Developing nations tend to hold pro-globalization views, but Bardhan warns that trend may not last long: “Their main source of comparative advantage in world trade is based on low labor cost. Over time, labor costs, as a dwindling part of total production costs, will be less of a decisive factor in determining patterns of trade…. Without large effective programs of skill formation and vocational training the political consequences for poor countries with masses of young people frustrated in their job prospects, as the traditional sectors like agriculture where they and their parents had been employed before decline, can be downright ominous.” Populists tend to undermine institutions that pose checks to their leadership. To battle populism, Bardhan warns, societies must understand the many forms. – YaleGlobal