Economic Shocks and Democratic Consolidation: Historical Evidence from Party-Level Electoral Volatility in France

The emergence of a stable party system is a central aspect of democratic consolidation. Building a novel historical dataset, we analyze how economic growth affected the party-level electoral volatility during the consolidation of the French democracy over the Third Republic (1870-1940). We document an asymmetric effect in that positive economic shocks produced electoral stability, while negative shocks had not the expected destabilizing effect. Moreover, a positive shock had a disproportionally stabilizing effect during economic prosperity, four times stronger than during an average economic conjuncture. As France experienced strong positive shocks over this period, our results imply that the party system consolidation may have been driven by a few exceptionally high growth episodes. We also find evidence suggesting that positive shocks developed voters' support for institutionally stable parties.