How Extremism is Made, not Born: The Political Economy of Extremism Regarding Redistribution

Historically, political extremists have been difficult to integrate into democratic societies. They have also been difficult to integrate into the political scientific study of democracies. Most often, for example, extremists are conceptualized in spatial terms as individuals occupying the extremes of a country’s ideological spectrum. But if extremism is more than a simple voting preference, the spatial interpretation provides no theoretical basis for the implied behavioral distinction between extremists and moderates. In practice, extremist positions are simply assumed to be associated with extremist behavior. Alternatively, extremists are diagnosed in psychological terms. However, this approach severs the link between extremist behavior and extremist positions. My paper explains the link between extremist positions and extremist behavior in terms of the fundamental political economic behavior associated with standard utility functions (i.e., utility increasing in income with diminishing marginal utility). My analysis, which is extends Aumann and Kurz’s (1977) bargaining model of voting on redistribution, also uncovers an important asymmetry in types of extremist behavior: radical extremism expressed as the willingness to risk financial ruin in the pursuit of transfers versus reactionary extremism expressed as the willingness to expend significant individual resources to prevent transfers. The model’s implications are tested using comparative two-wave panel data from the Political Action Survey panel study of Germany, the Netherlands, and the U.S. This data set not only captures institutional variation. It provides a measure of behavioral as opposed to merely positional extremism as well as a measure of individual income change, both of which are essential to testing the model.