Frustrated Expectations: Firm-Based Origins of Anti-System Politics

This article proposes a firm-based theory to explain the rise of anti-system politics, emphasizing the influence of firms on political attitudes. It argues that economic factors like globalization and technological change are insufficient explanations without considering firm strategies. Low-road employers, who offer low-quality jobs, create a mismatch between workers’ economic experiences and expectations, fostering feelings of unfairness and political dissatisfaction. Using a differences-in-differences design based on changes in Italian retail regulation, the study finds that the entry of large, low-road retailers boosts support for the radical right party, Lega Nord. A conjoint experiment surveying Italian private sector employees (n=1340) links low-road employment, within-firm inequality, and out-group employment opportunities to perceptions of unfairness and anti-system political attitudes. An information experiment confirms these findings, showing increased perceptions of unfairness when workers realize they earn less than similar workers, especially immigrants. These results highlight the importance of firm-level dynamics in political analysis.