In a recent article, the NY Times said inflation, immigration, inequality, and incumbency were responsible for public disapproval of political leaders.
Today, let’s take a look at inflation.
Inflation and Political Approval
Inflation
Spiking in many countries during 2022, most economists cite Covid as one cause of inflation. During the pandemic, governments spent more. The U.S. sent checks to households and purchased vaccines. In addition, disrupted supply chains elevated most companies’ costs. Responding, prices went up.
However, we should remember that inflation is the rate by which prices rise. While the inflation rate is down, prices remain up.
2022
In the U.S. and beyond, two years ago, most developed economies had high inflation numbers:
2024
This year, inflation rates have subsided:
Political Approval
The following political approval survey results from Morning Consult were gathered May 30 to June 5:
Our Bottom Line: Externalities
As economists, we can say that inflation, immigration, incumbency, and inequality certainly have had a political spillover. Taking us to the realm of externalities, the “four I’s” create a ripple of impacts far beyond their origin. But then, when we look at the numbers, we can ask if there is a thread. Comparing countries, for inflation and political approval, do we consistently see causation, correlation, or neither? I suspect the answer is neither.
My sources and more: The NY Times had the summary of how inflation, immigration, incumbency, and inequality affected politicians’ approval ratings. From there, I checked inflation data at the IMF and Our World in Data. As for approval ratings, I was not sure of Morning Consult’s accuracy but have seen that major new organizations cite their numbers.
Please note that the photo of G-7 leaders is our featured image.
