Tag: voter turnout

Do Election Results Shape Legitimacy Perceptions in Autocracy?

Posted on February 23, 2026 | Policy Brief

Elections remain a central feature of many authoritarian regimes despite widespread manipulation and limited political competition. Using a survey experiment with a nationally representative sample of Russian voters, this study examines whether improving perceptions of legitimacy can help explain why autocrats hold elections. The results show that information about high turnout increases trust in government, while information about low turnout reduces it, with effects driven by government supporters and individuals who believe in election integrity. This suggests that authoritarian leaders may use elections and reported electoral outcomes strategically to reinforce legitimacy among their support base and manage public perceptions over time.

Puzzle of Autocratic Elections

In recent decades, many authoritarian regimes have increasingly adopted institutions resembling those of democracies, particularly elections (Guriev and Treisman, 2019). Autocrats often organize multiparty elections and invite international observers, even as they manipulate outcomes through widespread fraud. This combination raises an important puzzle: if elections do not truly determine political power, why do authoritarian leaders hold them?

A large body of research has examined how authoritarian elections are organized (Gandhi and Lust-Okar, 2009; Gehlbach et al., 2016; Egorov and Sonin, 2020), including strategies such as limiting competition (Gandhi and Przeworski, 2007; Egorov and Sonin, 2021), managing media and information (Egorov et al., 2009; Edmond, 2013), and using elections to signal regime strength or monitor elites (Gehlbach and Simpser, 2015). However, less is known about whether these elections actually shape voters’ perceptions of government legitimacy (Dukalskis and Gerschewski, 2017).

One seemingly straightforward way to approach this question is to look at the relationship between electoral participation and trust in government, a key measure of political legitimacy. For example, across OECD countries, higher turnout is strongly correlated with greater trust in national governments (Figure 1). However, this descriptive pattern does not establish causality. Economic conditions may simultaneously shape both trust and electoral outcomes, creating omitted variable bias, while legitimacy itself may influence participation, leading to reverse causality.

These limitations point to the need for causal evidence on whether election results influence perceptions of legitimacy, particularly in non-democratic settings. The importance of such evidence is underscored by recent policy interest, including a commissioned report for the European Parliament on authoritarian legitimation through elections (Demmelhuber and Youngs, 2023). This policy brief presents findings from a recent study that addresses this issue, using a Russian election as a case study.

Figure 1. Trust in government and voter turnout in parliamentary elections in OECD countries (2017-2020)

Note: Trust is measured as a percentage of the population over 15 years old who answered ”Yes” to the following question in a nationally representative survey: “In this country, do you have confidence in the national government?” (Source: OECD). Turnout is the percentage of the registered voting population who voted in the last parliamentary election (Source: IDEA). Countries with compulsory voting are excluded.

Survey Experiment

To causally assess whether reported election outcomes influence perceptions of government legitimacy, the study implemented a survey experiment using a nationally representative sample of 1,603 Russian voters. The central feature of the design was a randomized information treatment that generated exogenous variation in respondents’ exposure to election results.

After completing the initial socio-demographic questions, respondents reported their prior political participation as well as their recollections of how past elections were conducted and their outcomes. Respondents were then randomly assigned to one of five treatment arms and asked to evaluate a hypothetical government formed after an upcoming election, with information about the election outcome randomly varied across treatment arms.

A control group received no information about hypothetical election results. Two groups were informed only about hypothetical voter turnout, which was presented as either low (38%) or high (66%). Two additional groups received information about turnout, either low or high, combined with a high vote share for the leading party (72%).

Following the information treatment, respondents reported their levels of trust in government, perceptions of whether the government represented national and personal interests, and their approval of and willingness to comply with hypothetical laws. These outcomes served as proxies for different dimensions of political legitimacy.

Election Outcomes Shape Trust in Government – but Only for Incumbent Supporters

By comparing responses across treatment groups, the experiment isolated the causal impact of election outcomes on legitimacy perceptions while holding constant respondents’ other characteristics. Respondents exposed to information about low turnout express significantly lower trust in government compared to those who received no information. On average, low turnout reduces trust by approximately 0.77 points on a ten-point scale, equivalent to about 0.25 standard deviations. In contrast, exposure to high turnout increases trust by around 0.68 points, or 0.22 standard deviations.

Providing additional information about the ruling party’s vote share does not significantly alter these effects. When high vote share information was combined with low turnout, trust increased slightly by 0.07 points, while adding vote share information to high turnout reduced trust by about 0.40 points; neither difference is statistically significant.

The impact of turnout information is highly heterogeneous. The observed effects are driven by individuals who expressed support for the ruling party, United Russia. Among these respondents, low turnout substantially lowers trust, while high turnout leads to a significant increase in trust. In contrast, opposition supporters do not update their perceptions in response to any of the information treatments: their trust levels remain statistically indistinguishable from those of the control group.

Moreover, the study examines heterogeneity based on baseline perceptions of electoral fraud. Before administering the information treatments, respondents were asked how frequently they believed irregularities in vote counting occur in Russian elections. Individuals who reported frequent violations are likely to view election outcomes as non-transparent and therefore to distrust official results, suggesting that information about turnout and vote share should have limited impact on their perceptions. Consistent with this expectation, no significant effect of turnout information on trust in government is observed among respondents who report a higher frequency of such violations.

Figure 2. Effect of information on trust relative to the control group

Note: This plot shows the effects of information treatments on trust in government relative to receiving no information (control group). Black circles are coefficient estimates for each group, with horizontal lines showing 95% confidence intervals.

Mechanisms: Expectation Shock and Anchoring

To examine how election information affects perceived legitimacy, the study relies on respondents’ reported recollections of past election results, including turnout and leading party performance. These prior beliefs provide a baseline against which new information is interpreted, as respondents tend to anchor their expectations about future elections to what they remember from previous ones.

When information about hypothetical election outcomes is presented, it generates exogenous shocks to these expectations. The magnitude and direction of each shock is defined as the difference between a respondent’s prior belief and the reported hypothetical outcome. By varying turnout between low and high values and combining turnout with high ruling party results, the experiment produced both positive and negative expectation shocks.

The results indicate that positive shocks, when the reported turnout exceeds prior beliefs, increase legitimacy across treatment groups, while negative shocks, when reported turnout is below the expected one, decrease legitimacy regardless of the treatment arm.

These findings suggest that election outcomes shape legitimacy by generating expectation shocks, and that respondents anchor beliefs about future elections to their perceptions of past results; in the absence of such anchoring, deviations between reported outcomes and respondents’ priors would have had little effect.

However, in the case of the leading party’s vote share, the resulting shock was rather small: an average respondent reported recalling the past vote share as 65%, while the value used in the information treatments was 72%. If respondents indeed anchor expectations about future election outcomes to past results, this may explain the absence of an additional effect of the vote share information, as the treatment did not generate a sufficiently strong expectation shock.

Conclusion

Do election results affect an autocrat’s perceived legitimacy? Using a survey experiment with a nationally representative sample of Russian voters, this study provides evidence that information about election outcomes can shape trust in government in an authoritarian setting. The results show that exposure to high (low) voter turnout increases (decreases) trust in government, with these effects concentrated among government supporters and individuals who believe elections are generally fair. This pattern suggests that autocrats may have limited ability to influence opposition supporters and instead rely on reinforcing legitimacy within their existing support base.

In addition, because voters anchor their expectations to past results, autocrats may be incentivized to generate higher outcomes while exercising caution in revealing lower ones in future elections. This underscores the role of autocratic elections as a tool to manage public perceptions over time.

The results of this study show that information about election outcomes holds strategic significance in non-democracies, as it can shape perceptions of government legitimacy. Policymakers should therefore prioritize support for independent media that provide credible information about election outcomes, even when results in authoritarian contexts appear predictable.

References

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

How Social Assistance Shapes Election Outcomes: The Case of Georgia

Posted on January 27, 2025 | Policy Brief

Protesters waving Georgian flags in front of the Parliament building in Tbilisi, Georgia, during a public demonstration following election outcomes.

This policy brief investigates the relationship between social assistance programs and election outcomes in Georgia, focusing on the 2024 parliamentary elections. Our regression analysis establishes a statistically significant link between an increase in social assistance beneficiaries and the vote share obtained by the incumbent Georgian Dream party. The results raise critical questions about the potential use of social assistance programs as a strategic political tool. Specifically, a 1 percentage point increase in targeted social assistance beneficiaries as a share of the population lead to an, on average, 0.5 percentage point increase in the Georgian Dream’s vote share, even after controlling for poverty-related factors. The findings recognize the dual impact of social assistance programs – alleviating poverty while shaping political behavior. They also underscore the need for ensuring that social assistance remains focused on addressing the needs of vulnerable populations without exerting undue political influence.

Introduction

The relationship between social assistance programs and electoral outcomes has gathered significant attention in both academic and policy circles, especially in the last decade. Social assistance programs, designed to support vulnerable populations, often carry political implications, particularly in developing democracies where incumbent governments may leverage these programs to secure voter loyalty. In Georgia, one of the largest components of social assistance is the targeted living allowance program, which, unlike other types of social assistance – such as those for individuals with special needs, internally displaced people, or elderly population –relies on assessing the beneficiaries’ poverty levels through proxy means testing (PMT). This makes subsistence allowance benefits vulnerable to biased, favorable selection by those in power. Allegations exist that the government may have strategically used this program, including increasing the number of beneficiaries in the lead-up to elections to secure votes or threatening existing beneficiaries with the withdrawal of their assistance based on their disclosed political preferences (Shubladze (2024); Japaridze (2023); Social Justice Center (2024)).

This policy brief explores the impact of social assistance on electoral outcomes in Georgia, specifically assessing whether increases in the number of targeted subsistence allowance beneficiaries during the 2020-2024 period influenced the votes received by the incumbent party in the 2024 parliamentary elections.

This analysis is especially important given the recent developments in Georgia’s political landscape. The 2024 parliamentary elections marked a critical juncture, with the Georgian Dream claiming to have secured 53.93 percent of the votes. Concerns over the fairness and transparency of the elections have been widespread. The Organization for Security and Co-operation in Europe’s (OSCE) Office for Democratic Institutions and Human Rights (ODIHR) reported systematic election irregularities, including pressure on voters, media bias, unequal campaign conditions, and election-day practices that compromised the ability of some voters – including public sector employees and recipients of social assistance – to cast their ballots without fear of retribution.

Our regression analysis documents a positive relationship between the number of living allowance beneficiaries and the votes garnered by the incumbent party across Georgian municipalities, raising further concerns about the integrity of the electoral process, and the allocation of state funds.

Political Implications of Social Assistance Programs: A Global Perspective

The link between social assistance and electoral outcomes has been widely studied. Social assistance programs often serve a dual purpose: they alleviate poverty and provide tangible support to vulnerable citizens while also shaping political behavior, particularly voting patterns. These programs can enhance incumbents’ electoral support by fostering gratitude among recipients, signaling government competence in addressing social needs, or creating concerns among beneficiaries that their political preferences if exposed, may influence the government’s decisions when choosing the beneficiaries of social assistance.

Research by De La O (2013) provides a compelling case in the context of Mexico. Examining the Progresa/Oportunidades conditional cash transfer program, De La O find that the program led to an increase in both voter turnout and incumbent vote share.

Zucco (2013) contributes further evidence from Brazil, where the Bolsa Família conditional cash transfer program emerged as a cornerstone of electoral strategy. Zucco demonstrates that municipalities with higher proportions of cash transfer beneficiaries tended to favor incumbent candidates in three different presidential elections, establishing a clear link between social assistance and voting behavior.

Adding to this body of work, Layton & Smith (2015) provide further insight into the nuanced ways in which targeted social assistance programs influence voter behavior in Latin America. The authors theorize that such programs simultaneously mobilize non-voters and convert opposition supporters, with variations based on country-level political and programmatic differences.

In addition, recent research from Indonesia further illustrates the impact of social assistance budgets on electoral outcomes. A study by Dharma, Syakhroza, and Martani (2022) examines 212 regencies and cities in Indonesia where incumbents participated in local elections. The findings reveal a direct positive effect of social assistance spending on incumbent votes. The authors further claim that high political competition counteracts incumbents’ advantages and mitigates the effectiveness of such spending.

The international literature thus provides valuable motivation for exploring the Georgian case, where social assistance may play a similar role in shaping voting behavior.

The Georgian Context

The deeply controversial October 26, 2024, parliamentary elections in Georgia mark a pivotal moment in the country’s political history. According to the Central Election Committee of Georgia, the ruling party, the Georgian Dream, secured 53.93 percent of the votes, maintaining its dominant position in Georgian politics. However, the elections were accompanied by widespread allegations of electoral malpractice, casting a shadow over their legitimacy and raising concerns about the future of democratic governance in the country.

OSCE’s ODIHR provided a comprehensive observation of the electoral process, noting both positive aspects and critical shortcomings. While the elections were generally well-administered, ODIHR’s final report emphasized significant concerns related to the broader political environment. Key issues included the adoption of legislation that undermined fundamental freedoms, restrictions on civil society, and a pervasive atmosphere of voter intimidation. Specific election-day practices, such as pressuring voters and leveraging administrative resources, were highlighted as undermining the integrity of the process. The report also mentions instances in 16 municipalities where public sector employees and economically vulnerable groups, particularly those reliant on social assistance, faced pressure to support the ruling party. Such fear of losing social benefits or facing retribution at work creates an atmosphere where voters struggle to form independent opinions and vote independently.

Further scrutiny from independent analysts has shed light on systematic irregularities that suggest the elections may not have reflected the genuine will of the Georgian electorate. Gutbrod (2024) suggests that tactics such as vote buying, mass intimidation, and direct manipulation of electoral outcomes were employed, leading to statistical anomalies. Specifically, the Georgian Dream’s support increased disproportionately in precincts linked to reported violence and irregularities. Additionally, social assistance beneficiaries were identified as a target group for snowball mobilization, organized by individuals affiliated with the Georgian Dream – a method where participants are encouraged to mobilize or identify a certain number of additional people to expand voter outreach and engagement.

Social Assistance in Georgia

The Law of Georgia on Social Assistance outlines several types of social welfare programs aimed at addressing the needs of vulnerable populations. These include living allowance, reintegration assistance, foster care allowance, adult family member care allowance, non-monetary social assistance, and social package. Among these, the targeted social assistance program, commonly referred to as the “living allowance“, holds particular significance. This program is designed to provide financial support to families living in extreme poverty. Eligibility for the living allowance is determined through a proxy means test that evaluates the socioeconomic conditions of applicants, ensuring that the assistance reaches those most in need. For this policy brief, the focus will be on beneficiaries of the living allowance (hereafter social assistance beneficiaries), as their numbers and electoral behavior present a unique opportunity to analyze the intersection of social assistance and voting patterns in Georgia.

As of October 2020 (previous parliamentary elections’ date) 142,870 families in Georgia received social assistance, benefiting a total of 510,343 individuals. The total amount of social assistance transfers during this period amounted to 28,825,259 GEL. Over the next four years, leading up to the 2024 Parliamentary Elections, social assistance grew significantly. By October 2024, the number of families receiving assistance had increased by 25 percent to 178,107 families, while the number of individual beneficiaries rose by 34 percent, reaching 684,432. The most notable expansion occurred in the total amount of social assistance transfers, which surged by 143 percent to 69,936,512 GEL. This corresponds to a cumulative annual growth rate of 25 percent (Social Service Agency of Georgia, 2024).

In 2022, an important modification was introduced for social assistance beneficiaries aged 18 years to retirement age and without disabilities or serious health conditions, offering employment opportunities mainly, in the public sector with a salary of up to 300 GEL per month. These wages did not affect recipients’ existing social assistance benefits. Participants had the option to take suitable public sector jobs, formalize any informal employment, or, if formally employed in the private sector, provide necessary documentation. The modification covered also new beneficiaries who were not already formally employed. Notably, families or individuals enrolled in the program were guaranteed eligibility for a living allowance for four years, as their social assistance status would not be reassessed during this period.

As of October 2024, 50,962 families were enrolled in the program with guaranteed social assistance, accounting for 28.6 percent of all families receiving social assistance. The monthly spending of social assistance transferred to these families amounted to 22,766,706 GEL, representing 33 percent of the total social assistance transfers.

The significant increase in social assistance beneficiaries and the introduction of the 2022 program for employing social assistance recipients, guaranteeing them four years of social assistance transfers, highlight the growing scope and influence of targeted social welfare initiatives in Georgia. While these developments may have addressed pressing socioeconomic challenges, they also raise important questions about the potential political motivations. Specifically, the substantial increase in the number of beneficiaries and the guaranteed eligibility linked to employment programs could be interpreted as mechanisms to foster voter loyalty and mobilization in favor of the ruling party.

Methodology and Results

To examine the relationship between the increase in social assistance beneficiaries and electoral outcomes, particularly the votes garnered by the incumbent Georgian Dream party, we employ a regression analysis framework. This statistical method allows us to explore whether and to what extent the growth in social assistance recipients is associated with the changes in the vote share of the incumbent party. Since social assistance depends on the varying levels of poverty across municipalities, we incorporate control variables that isolate the effect of economic well-being, minimizing potential confounders.

The study utilizes data from two primary sources: information on social assistance recipients, including families, and individuals, and the total amount of transfers across municipalities, was retrieved from the Social Service Agency of Georgia. This dataset covers 64 municipalities (and self-governing cities) in Georgia. From 2022, data includes families and individuals guaranteed to retain their socially vulnerable status for four years under the State Program for Promoting Public Employment. Second, election data was sourced from the Central Election Commission of Georgia, covering both the 2024 and 2020 parliamentary elections. The 2024 data covers the results from both electronic and non-electronic voting. Key variables include the number of registered voters, total votes cast, and votes obtained by the Georgian Dream and opposition parties. This election data is also aggregated at the level of the 64 municipalities (and self-governing cities).

Information on poverty levels in Georgian municipalities is not publicly available; therefore, we utilize control variables for employment and economic activity with the latter proxied by either the municipalities’ tax revenues or the value added generated in the private sector. Information on employment and value added are gathered from the National Statistics Office of Georgia, while data on tax revenues is retrieved from the Ministry of Finance.

The following table describes the results of the regression analysis.

Table 1. Regression analysis results

Source: Author’s calculations.
Note: The values in parentheses indicate the p-value. *Significant at the 10 percent level; **Significant at the 5 percent level; ***Significant at the 1 percent level.

The first regression (column 1) investigates the relationship between the change in social assistance beneficiaries as a share of the population and the change in the Georgian Dream party’s vote shares, displaying a significant relationship between the two. Specifically, the coefficient (0.49) is significant at the 5 percent level, suggesting that a 1 percentage point increase in social assistance beneficiaries as a share of the population, increases the vote share for the Georgian Dream by approximately 0.49 percentage points.

To control for the effect of poverty, we first use employment rates in 2023 (the latest available data) as a proxy for poverty. Column 2 presents these results. In this specification, the coefficient for the change in social assistance beneficiaries remains significant at 5 percent level and its value (0.47) remains consistent with the previous specification. The model further suggests that poverty is also positively and significantly (at the 1 percent level) associated with incumbent votes – the higher the poverty (lower employment) in municipalities, the higher the Georgian Dream vote share.

In the next step (column 3), we model the relationship between the change in the Georgian Dream’s vote share, change in employment as a share of the population, mobilized local tax revenues per capita, and the change in number of social assistance beneficiaries as a share of the population. Change in employment, calculated as the difference between 2019 and 2023 employment levels (as a share of the population), is used as a proxy for change in poverty.  Tax revenues per capita for 2023 reflect economic activity across municipalities and self-governing cities, serving as a proxy for well-being. As seen in the table, change in employment is not statistically significant, however, the amount of tax revenues mobilized across municipalities is modestly significant. The coefficient for change in social assistance beneficiaries is once again statistically significant and consistent with the other specifications in terms of magnitude (at 0.51).

As a robustness test (column 4) we replace the previously used proxy for economic well-being (tax revenues), with the private sector value added per capita for 2023, which significantly (at the 1 percent level) correlates with an increase in the vote share for the incumbent party. Changes in employment remain insignificant. Importantly, the coefficient for change in social assistance beneficiaries remains positive (0.53) and statistically significant at the 1 percent level.

The discussed regression models were tested for a different dependent variable as well. In addition to observing the impact of change in vote shares, we also analyzed the impact on the number of votes cast for the Georgian Dream party between the 2020 and 2024 Parliamentary Elections. Changes in social assistance beneficiaries remain a significant explanatory variable in this specification as well.

The estimated impact of social assistance is consistent across all models, both in magnitude and significance, reinforcing the finding that increases in living allowance beneficiaries are strongly associated with higher vote shares for the Georgian Dream party, underscoring the critical role of social assistance in shaping electoral outcomes.

Conclusion

The analysis demonstrates a strong and statistically significant relationship between the increase in social assistance beneficiaries and the vote share obtained by the incumbent Georgian Dream party in the 2024 parliamentary elections. Even after controlling for poverty and economic well-being, the results highlight the impact of social assistance in shaping electoral outcomes. The findings suggest that a 1 percentage point rise in social assistance beneficiaries as a share of the population translates into a 0.47–0.53 percentage point increase in the Georgian Dream’s vote share. When contextualized within the overall election results, these estimates suggest that the expansion of the targeted social assistance program may have garnered the Georgian Dream an additional 45 ,500 to 50,000 votes, representing 2.2–2.5 percent of the total votes.

The results raise critical questions about the potential use of social assistance programs as a strategic political tool. The robustness of the relationship across multiple models suggests that the observed trends are not merely byproducts of economic conditions but reflect a deliberate link between social assistance expansion and electoral outcomes. The implications are significant for democratic governance in Georgia. The strategic use of social welfare programs risks undermining public trust in the electoral process and highlights the need for greater transparency and accountability in the implementation of social assistance policies. Recognizing the dual impact of these programs – alleviating poverty while potentially shaping political behavior – will be critical in fostering fairer electoral conditions and ensuring that social assistance remains focused on addressing the needs of vulnerable populations without undue political influence.

References

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Polish Parliamentary Elections 2023: Social Transfers and the Voters the Government is Counting On

Posted on October 9, 2023 | Policy Brief

20231009 Polish Parliamentary Elections Image 02

The heated election campaign preceding the October 15th election in Poland has focused on fundamental issues related to the rule of law, migration, media freedom, women’s and minority rights, climate policy as well as Poland’s role on the international arena. The election outcome will determine Poland’s role in the EU and as well as the country’s future relations with Ukraine. It will also be decisive for the direction of Polish politics and the foundations of socio-economic development for many years to come. Despite these issues, the primary worries for a substantial portion of Polish households concern the domestic challenges of increasing prices and material uncertainty. With this in mind, this Policy Brief summarizes the results of CenEA’s recent analysis, which demonstrates a clear pattern in the United Right government’s policy, that in the last four years has strongly favored older groups of the Polish population. In the 2019 elections financial support directed to families with children was a key factor in securing a second term in office for the governing coalition. It remains to be seen if the focus on older voters pays off in the same way on October 15th.

Introduction

The upcoming parliamentary elections on October 15th will close a very special term of the Polish Parliament, marked by the Covid-19 pandemic, a surge in prices of goods and services, as well as the full-scale, ongoing Russian invasion of Ukraine and the tragic consequences associated with it. An evaluation of the second term of the United Right’s (Zjednoczona Prawica) government should, on the one hand, cover the most important decisions made in response to these crises. On the other hand, the last four years have also been a time of significant decisions with important medium- and long-term consequences, both directly for Polish households’ financial situation and more broadly for the economy at large and the country’s socio-economic development.

The heated election campaign has focused on the fundamental issues related to the rule of law, migration, media freedom, women’s and minority rights, climate policy as well as Poland’s role on the international arena. The upcoming vote is likely to be decisive in regard to Poland’s relations with partners in the EU, the role it will play in the EU and – as recent government declarations have demonstrated – the development of future relations with Ukraine. The result of the October elections will be pivotal also for the direction of Polish politics and the foundations of socio-economic development for many years to come. At the same time however, recent surveys have shown that the main concern for a significant part of the Polish society lies closer to home, driven by the challenges of rising prices of goods and services and related material uncertainty.

In light of this, this policy brief summarizes the tax and benefit policies directly affecting household finances, which were implemented in the first and second term of the United Right’s rule (i.e., 2015-2019 and 2019-2023). The brief draws upon a detailed analysis published recently in the CenEA Preelection Commentaries (Myck et al. 2023 a,b,c). The results show a notable shift in the government’s focus – while families with children were the main beneficiaries of the reforms implemented in the first term, the policies over the last four years have concentrated transfers and tax advantages to older generations. As we approach election day, it seems likely that the government will further try to mobilize support from this group of voters

The United Right’s Second Term: Tax and Benefit Reforms During High Inflation

In recent years, Polish households has, apart from two major crises (the Covid-19 pandemic and the complex consequences from the Russian invasion of Ukraine), faced one of the greatest price increases in the EU. During the closing term of Parliament, from January 2020 to July 2023, prices increased by 35.6 percent and have continued to grow at a rate significantly exceeding the inflation target set by the National Bank of Poland (2.5 percent +/- 1 percentage point per year). By the end of 2023 the combined inflation rate will reach 38.7 percent. Although average wages have also been rising (nominally by 41.7 percent from January 2023 to July 2023), wage growth has not kept up with the inflation for many workers. One needs to also bear in mind that a significant proportion of Polish households rely on income from transfers and state support. At the same time households’ material conditions have deteriorated as a result of a significant reduction in the real value of their savings.

In 2022 and 2023 the government introduced a number of temporary policies designed specifically to assist households facing higher energy and food prices. Throughout the final term in office, it also adopted several reforms which – as we show below – affected some groups more than others, reflecting a clear policy preference:

a) in January 2020 and May 2022 respectively, the government legislated an additional level of support addressed to retirees and disability pensioners. These so-called 13th and 14th pensions have raised the minimum level of pension benefits.

b) in January 2022 the government implemented a major overhaul of the income tax system (the so-called Polish Deal) which significantly influenced the tax burden on most taxpayers, strongly benefitting pension recipients.

c) throughout the term of Parliament, the government has kept the values of most social benefits frozen at their nominal level. This includes its flagship program – the universal 500+ parental benefit (500 PLN, roughly 110 EUR per child per month), introduced in 2016 – as well as means tested family benefits directed to poorer families with children. As a result, both the values as well as eligibility thresholds has fallen by nearly 40 percent.

The implications of these three policy areas are reported in Table 1 for the 2019-2023 term of Parliament and contrasted with benefits and costs from government policies implemented in the first term of Parliament (2015-2019). The results have been calculated using the SIMPL microsimulation model and are based on a representative sample of over 30 000 Polish households from the 2021 Household Budget Survey (for methodological details see Myck et al., 2015; 2023c). The applied method allows for singling out policy effects from other factors affecting household incomes.

Table 1 shows a clear difference in focus; from substantial benefits directed at families with children in 2015-2019 to policies targeted at pensioners, partly at the cost of families with children, in the second term. It is also worth noting that while government policy continued to increase household incomes, the resulting gains in disposable incomes in the second term have been much more modest.

Table 1. The impact of modelled policies in the tax and benefit system on household income in the two terms of the United Right’s government.

Source: CenEA – own calculations using the SIMPL model based on 2021 Household Budget Survey data (reweighted for simulation purposes and indexed to July 2023).
Notes: Simulations with respect to the system and price level from July 2023. Changes are presented in relation to the indexed system from 2015 for the first term of office of the United Right government and the indexed system from 2019 for the second term of office. *Including family allowance with supplements, care benefits, parental leave benefit, and one-off allowance for the birth of a child. The applied exchange rate is 4.6PLN=1EUR.

The contrast is also visible when the totals from Table 1 are divided and allocated to specific family types, as presented in Figure 1. On average lone parent families gained about 800 PLN (170 EUR) per month as a result of policies implemented in the 2015-2019 term, while they lost 160 PLN (35 EUR) in the second term. Married couples with children gained 950 PLN (205 EUR) and lost 259 PLN (55 EUR) in each term, respectively. In contrast to this, gains of pensioner families were modest during the first term, while the policies implemented in the second term imply gains of about 310 PLN (70 EUR) per month for single pensioners and 630 PLN (140 EUR) per month to pensioner couples. Gains and losses by family type resulting from policies implemented between 2019-2023 are shown in more detail in Figure 2. Over 85 percent of single pensioners have seen gains of more than 200 PLN (45 EUR) per month, and a similar proportion of pensioner couples gained over 400 PLN (90 EUR) per month. At the same time the majority of families with children, both among lone parent families and married couples, principally as a result of benefit freezes, saw their incomes fall in real terms. The values of the universal 500+ parental benefit will be indexed in January 2024, and the government has made this indexation an important element of the campaign. However, the indexation will not compensate the losses that families experienced in the last four years, a period with high inflation. It remains to be seen if a promise of higher transfers in the future will translate into political support, as seen in the 2019 elections (Gromadzki et al. 2022).

Figure 1. The impact of modelled policies in the tax and benefit system on household income in the two terms of the United Right’s government, by family types.

Source: CenEA – own calculations using the SIMPL microsimulation model based on 2021 Household Budget Survey data (reweighted for simulation purposes and indexed to July 2023).

Figure 2. Ranges of monthly benefits and losses resulting from the modelled policies introduced in the United Right government’s second term of office (2019-2023), by family type.

Source: CenEA – own calculations using the SIMPL microsimulation model based on 2021 Household Budget Survey data (reweighted for simulation purposes and indexed to July 2023).

Timing and Other Tricks: Securing the Votes of Older Generations

The so-called 13th and 14th pensions are paid once per year, in May and September respectively, to recipients of public pensions, at a value equivalent to a monthly minimum pension (approximately 360 EUR). While the first is a universal benefit, the latter has a withdrawal threshold and is thus targeted at lower income pensioners. In 2023 the government decided to increase the value of the 14th pension to about 580 EUR, with the benefits paid out to pensioners in September, the month before the election. This additional bonus came at the cost of about 7 billion PLN (1.6 billion EUR) – a budget which could have paid for two years of indexation of benefits targeted at low-income families with children or financed the payment of the indexed value of the universal 500+ parental benefit for nearly four months. The decision completes the picture of a clear preference for the older generation in regard to social policy in recent years and suggests a clear focus on this group of voters prior to the upcoming election.

The government has also taken a number of steps to facilitate electoral participation among voters in smaller communities by increasing the number of polling stations and making it obligatory for local administrations to finance transportation for older individuals with mobility limitations. The government is also mobilizing voters in smaller communities with turn-out competition initiatives. Additionally, some commentators have pointed out that the choice of election day – one day ahead of the so-called ‘Papal day’, devoted to the memory of John Paul II – is also non-accidental.

Conclusion

The analysis presented in the recent CenEA Preelection Commentaries and summarized in this brief indicates that in the area of reforms directly affecting household incomes, pensioners are the social group that benefited most from the United Right’s government policies in the 2019-2023 term of office. This is evident both from policies that have become a permanent feature of the Polish tax and benefit system, as well as from various one-off decisions. Taking into account other policies surrounding the approaching parliamentary election, it seems clear that the government is strongly counting on the support of older generations of voters on October 15th. As election day is approaching it becomes more and more evident though, that securing their vote may not suffice to win a third term in office. Numerous policy and corruption scandals, a significant departure from judicial independence and an extreme degree of governing party dominance in public media have come to the fore of public debate ahead of the vote. According to recent polls the final outcome is still uncertain and even small shifts in support might swing the future parliamentary majority. According to Gromadzki et al. (2022), financial support directed to families with children was a key factor for securing a second term in office for the United Right coalition four years ago. It remains to be seen if the policy focus on older voters pays off in the same way on October 15th.

Acknowledgement

The authors wish to acknowledge the support of the Swedish International Development Cooperation Agency (Sida) under the FROGEE and FROMDEE projects. FREE Policy Briefs contribute to the discussion on socio-economic development in the Central and Eastern Europe. For more information, please visit www.freepolicybriefs.com.

References

Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.

Is War Good for a Country’s Political Institutions?

Posted on November 30, 2015 | Policy Brief

Author: Tom Coupe, KSE.

Recent research suggests that experiencing war violence might make people more likely to turn out during elections. Using data from the conflict in Eastern Ukraine, we show, however, that people who were injured or had close friends or relatives killed or injured were less likely to turn out at the 2014 parliamentary elections. We also show that the impact of violence on turn out and political views depends on the type of violence one experienced.