Ek 1: Bursiyer ve Programa Ait Bilgi Formu Adı-Soyadı Sözleşme No. TR2016/DG/04/A1-01/1067 Başvuru Yaptığı Sektör Üniversite (Kamu-Üniversite-Özel Sektör) Başvuru Esnasında Bağlı Bulunulan Kurum Boğaziçi Üniversitesi Başvuru Esnasında Bağlı Bulunulan Kurumdaki Öğrenci Unvan Çalışma Alanı (AB Müktesebat Başlığı) Ekonomik ve Parasal Politika Öğrenim Görülen Ülke Birleşik Krallık Öğrenim Görülen Şehir Colchester Programın Öğretim Dili İngilizce Üniversite The University of Essex Fakülte Sosyal Bilimler Fakültesi Bölüm Hükümet Program Adı Küresel ve Karşılaştırmalı Siyaset Programın Başlangıç/Bitiş Tarihleri (PDS 04.10.2018 – 04.10.2019 belgesindeki tarihler) Öğrenim Süresi (ay) 12 Avrupa Merkez Bankası Para Politikası ve Avrupa-şüpheci Tez/Araştırma Çalışmasının Başlığı Popülist Partilerin Yükselişi Danışmanının Adı/Soyadı Thomas Winzen Danışmanının E-posta Adres/leri [email protected] NOT: Bu sayfa bilgisayar ortamında doldurulduktan sonra tez/araştırma raporu metnine ilgili sıra ile eklenmelidir. Annex 1: Scholar and Programme Information Form Name/Surname Burak Bulkan Contract No. TR2016/DG/04/A1-01/1067 Sector as of the Application Date University (Public Sector-University-Private Sector) Institution as of the Application Date Boğaziçi University Title as of the Application Date Student Field of Study (i.e. EU Acquis Chapter) Economic and Monetary Policy Country of Host Institution The United Kingdom City of Host Institution Colchester Language of the Programme English Host Institution The University of Essex Faculty Faculty of Social Sciences Department Government Name of the Programme Global and Comparative Politics Start/End Dates of the Programme (as in the PDS) 04.10.2018 - 04.10.2019 Duration of the Programme (months) 12 Monetary Policy of the European Central Bank Title of the Dissertation/ Research Study and the Rise of the Eurosceptic Populist Parties Name of the Advisor Thomas Winzen E-mail/s of the Advisor [email protected] NOT: Bu sayfa bilgisayar ortamında doldurulduktan sonra tez/araştırma raporu metnine ilgili sıra ile eklenmelidir. THESIS/RESEARCH REPORT APPROVAL PAGE I have examined the dissertation/research report entitled MONETARY POLICY OF THE EUROPEAN CENTRAL BANK AN THE RISE OF THE EUROSCEPTIC POPULIST PARTIES presented by BURAK BULKAN and hereby certify that it is worthy of acceptance.1 22/09/2019 DR THOMAS WINZEN University of Essex 1 The dissertation will be assessed and graded by two anonymous examiners and not by the supervisor. UNIVERSITY OF ESSEX Monetary Policy of the European Central Bank and the Rise of the Eurosceptic Populist Parties Burak Bulkan 1802996 MA Global and Comparative Politics Supervisor: Dr Thomas Winzen 06/09/2019 Word Count: 10690 1 Contents i. List of Figures……….…..……………………………………….…………….….3 ii. List of Tables……………………………………….………………………….....4 iii. Acknowledgement…………………………………………………..……….…..5 iv. Abstract……………………………………………………………..……………6 v. Özet…………………………………………………………………..……….…..7 1. Introduction………………………………………….………………………..…8 2. Literature Review on Central Bank and Eurosceptic Populism………..…..…..11 2.1. Central Banks and Their Independence………….………………….....11 2.2. Central Banks vis a vis Populists…..………………………………......13 2.3. Eurosceptic Populism and Its Political Economy……………………...14 3. Theoretical Framework………………...………………………………..….….17 3.1. Populist or Pro-Populism Voter vs Monetary Policy of the ECB…….17 3.2. Economic Voting Behaviour………………………..………….……..20 3.3. Hypotheses……..…………...………………………………….……..21 4. Methodology and Research Design..……………….………………….……….24 4.1. General Method and Model Selection………………………..……….24 4.2. Dependent Variables………………………………..………………...25 4.3. Explanatory Variables…………………………………...……………28 4.4. Control Variables……………………….………...……...……………29 5. Results and Discussion…………………………………………………………31 5.1. National General Elections…………………………..……….……….31 5.2. European Parliament Elections……………………….……………….36 5.3. Further Analysis……………………...……………………………….41 5.4. Discussion…………..….…………………………….…………….….45 6. Conclusion……………………….……………………………………………..48 7. Bibliography…………………………………………………..……………..…50 8. Appendix. …………………………………………..………………………..55 2 List of Figures Figure 1: Vote Shares of the Eurosceptic Populist Parties in the General Elections between 1998-2018……………………………………………………………….....27 Figure 2: Vote Shares of the Eurosceptic Populist Parties in the EP Elections between 1998- 2018…………………………………………………………………………………..27 Figure 3: Adjusted Predictions of the Interest Rate and Vote Shares in General Elections in the Fixed-Effect Model………………………………………….……………..32 Figure 4: Adjusted Predictions of the Interest Rate and Vote Shares in the EP Elections in the PCSE Model……………………………………………………..……………32 Figure 5: Adjusted Predictions of the Inflation Rate and Vote Shares in General Elections in the Fixed-Effect Model……………………………………………….………..35 Figure 6: Adjusted Predictions of the Inflation Rate and Vote Shares in the EP Elections in the PCSE Model….…………………………………………………….………35 Figure 7: Adjusted Predictions of the Interest Rate and Vote Shares in the EP Elections in the Fixed-Effect Model….…………………………………………………..……36 Figure 8: Adjusted Predictions of the Interest Rate and Vote Shares in the EP Elections in the PCSE Model….…………………………………………………………...…..37 Figure 9: Adjusted Predictions of the Inflation Rate and Vote Shares in the EP Elections in the Fixed-Effect Model….………………………………………………………..38 Figure 10: Adjusted Predictions of the Inflation Rate and Vote Shares in the EP Elections in the Fixed-Effect Model….….…………………………………...……38 Figure 11: Vote Shares of the Eurosceptic Populist Parties in General Elections with the Interest Rate and the Inflation Rate….….…………………………………………58 Graph 12: Vote Share of the Eurosceptic Populist Parties in the EP Elections with the Interest Rate and the Inflation Rate….….…………………………………………….58 3 List of Tables Table 1: Vote Share of the Eurosceptic Populist Parties in General Elections Between 1998-2018……………………………………………………....………………………33 Table 2: Vote Share of the Eurosceptic Populist Parties in the EP Elections Between 1998-2018………………………………………………………………………………40 Table 3: Vote Share of the Eurosceptic Populist Parties in General Elections (Means).42 Table 4: Vote Share of the Eurosceptic Populist Parties in the EP Elections (Means)...44 4 Acknowledgement I would like to express my sincere appreciation to my supervisor Dr Thomas Winzen for his valuable and priceless guidance and encouragement. He was always helping and available for my questions. I also would like to express my gratitude to Dr Alexandra Hennessy for her valuable contribution and guidance during the period of writing the dissertation. Also, I would like to express my special appreciation to the Jean Monnet Scholarship that made my study at the University of Essex possible in every aspect. This was a very important experience and acquisition for my academic career that I want to build. Additionally, I would like to present my thanks to the members of Jean Monnet Scholarship Program Office who were always helpful and available in any case. 5 Abstract In the literature, the effect of the populist parties on central banks have been handled. However, this study will have a different approach to this relationship. It will investigate the relationship and the correlation between monetary policy of the European Central Bank (ECB) and vote share of the Eurosceptic populist parties by looking at the effect of monetary policy of the bank on vote shares of these parties in general and the EP elections between 1998 and 2018 in twelve European Union member countries. The study will provide empirical results for the effect of the bank on vote shares by checking the influences of the interest rate and the inflation rate on the preferences of the voters. Keywords: ECB, populism, Euroscepticism, interest rate, inflation rate, election 6 Özet Daha önce literatürde, populist partilerin Merkez bankaları üzerindeki etkileri ele alınmıştır. Ancak, bu çalışma bu ilişkiye farklı bir yaklaşım sunacak. Çalışma Avrupa Merkez Bankası (AMB) para politikası ile Avrupa-şüpheci populist partilerin oy dağılımı arasındaki ilişki ve ilintiyi AMB’nin para politikasının bu partilerin 1998 ve 2018 yılları arasında on iki Avrupa Birliği üyesi ülkedeki genel ve Avrupa Parlamentosu seçimlerindeki oy dağılımı üzerindeki etkisine bakacak inceleyecek. Bu tez AMB’nin faiz oranı ve enflasyon oranının seçmen tercihindeki etkisini inceleyerek AMB’nin oy dağılımı üzerindeki etkisi hususunda ampirik sonuçlar sunacaktır. Anahtar kelimeler: AMB, popülizm, Avrupa-şüphecilik, faiz oranı, enflasyon oranı, seçim 7 MONETARY POLICY OF THE EUROPEAN CENTRAL BANK AND THE RISE OF THE EUROSCEPTIC POPULIST PARTIES 1. INTRODUCTION After the Global Crisis in 2008 and the Euro Debt Crisis in 2009, the discourse of the populist parties has become popular and attractive across the world. In Europe, most populist parties have started to be much more visible and audible in the literature. Most of them have already had a Eurosceptic characteristic, in different aspects, blaming or criticizing the European Union (EU) with its policies, structure and organs. The precautions recommended and taken by both the EU administrations and national governments, mostly fiscal austerity, have created unrest among people almost in all countries in the Union. Through the crisis and responses against the economic policy of the EU, while austerity policy was being the new political agenda, and social and economic inequalities are increasing as well as European integration