Tuesday, August 16, 2011

Fact. There is a link between cuts and riots

by Jacopo Ponticelli and Hans-Joachim Voth

August 16, 2011

When London stopped burning, the political debate about the causes of unrest began to heat up. At one end of the spectrum, Ken Livingstone blamed the government's cutbacks; at the other, David Cameron attributed the unrest to criminal behaviour, pure and simple. Many of the cuts announced by the coalition government haven't been implemented yet; but it is also true that there is real deprivation in many parts of London, and local services have been cut in some areas already. So, where do sudden conflagrations such as those in London last week come from?

A constructive way to approach such a complex question is to distinguish between the incidents that touch off unrest, and the underlying causes that make it more likely. When a petrol station burns down, you don't just want to know who dropped the cigarette; you want to know why all the combustible fumes escaped. Social unrest and instability is typically difficult to explain. In most years, nothing happens; then, suddenly, violence erupts. Academics have tried to understand which factors are involved in creating explosive social environments. According to work on US race riots by the economist Ed Glaeser, for example, ethnic heterogeneity in a neighbourhood increases the probability of unrest. So does unemployment. Poverty, on the other hand, seems to play a smaller role.

In a recent study, we focused on the link between austerity measures and unrest. We analysed a large number of countries, over almost a century, to unearth some empirical regularities. In two studies, we analysed unrest in 28 European countries from 1919 to 2009, and in 11 Latin American countries since 1937. What we found is a clear and positive statistical association between expenditure cuts and the level of unrest.


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