IZA DP No. 2411: Family and Politics: Does Parental Unemployment Cause Right-Wing Extremism?
revised version published as 'Parental unemployment and young people's extreme right-wing party affinity: evidence from panel data' in: Journal of the Royal Statistical Society: Series A, 2011, 174 (3), 737 - 758
Recent years have witnessed a rise in right-wing extremism among German youth and young adults. This paper investigates the extent to which the experience of parental unemployment during childhood affects young people’s far right-wing attitudes and xenophobia. Estimates from three different German data sets show a positive relationship between growing up with unemployed parents and right-wing extremism, with xenophobia in particular. This paper uses differences in unemployment levels between East and West Germany, both before and after reunification, to investigate a causal relationship. Instrumental variables estimates suggest strong and significant effects of parental unemployment on right-wing extremism. This is consistent with classical theories of economic interest and voting behaviour which predict that persons who develop feelings of economic insecurity are more susceptible to right-wing extremism and anti-foreign sentiments.