Economic prosperity is the best recipe for an incumbent government's re-election. In certain po-litical contexts, economic prosperity is more crucial than in others. Motivated by the persistent differences in electoral volatility of incumbent parties between established and new democracies, this paper investigates the contextual factors, which affect the vulnerability of governmental par-ties to bad economic performance. Two context variables moderate the degree to which voters punish governing parties for bad performance (retrospective voting): types of democratic legiti-macy, and the intensity of party-voter linkages. We test our hypotheses on a new dataset on elec-toral volatility in 55 countries in Europe, Latin and North America, over 24 years. Our results show that young democracies tend to have a more performance oriented view of democracy, which makes governments more vulnerable to economic downturns. The main beneficiaries of the economic crisis in young democracies are newly founded political parties.
Co-Author: Miriam Hänni
