Rolling Back Subsidies, Rolling in the Unrest? Social Policy Reform and Civil Unrest in Iran

To what extent do reforms of food and energy subsidies trigger civil unrest? Governments tend to assume that rollbacks of food and energy subsidy systems are a recipe for popular mobilisation against their rule. This is particularly true of rulers in the Middle East and North Africa (MENA), where subsidy systems have over the course of several decades become part and parcel of the "social contract". Although evidence exists that links austerity and the rise in food prices to protest, our knowledge on subsidy reforms, and in particular the extent to which mobilisation against rollbacks of subsidies rests on specific content, context, or reform design, remains limited. We address this gap through a mixed-methods study of Iran in the period from 1974 to 2023. We cross-match an original dataset of food and energy subsidy reforms in the MENA region with large protest event data from a variety of sources (e.g. ACLED, ICEWS, V-Dem). We then use negative binomial and difference-in-difference models, as well as process tracing, to test the relationship between the onset of subsidy reforms and civil unrest. Our results suggest that the relationship between subsidy reform and popular mobilisation is weaker than assumed by MENA policy makers. Occurrence of protest depends on timing, reform design, and political and economic context. The findings have important implications for our understanding of social policy reform and political (in)stability but also of the relationship between austerity, popular mobilisation, and civil unrest more generally.