The effects of economic austerity on pro-sociality: Evidence from Greece
| Author | Nicholas Sambanis,Elena Nikolova,Anna Schultz |
| DOI | http://doi.org/10.1177/14651165221120527 |
| Published date | 01 December 2022 |
| Date | 01 December 2022 |
| Subject Matter | Articles |
The effects of economic
austerity on pro-sociality:
Evidence from Greece
Nicholas Sambanis
Department of Political Science, University of Pennsylvania,
Philadelphia, PA, USA
Elena Nikolova
College of Interdisciplinary Studies, Zayed University, Dubai, UAE
Anna Schultz
Independent researcher
Abstract
The European sovereign debt crisis resulted in policies of fiscal austerity and economic
downturn in Greece, marked by a prolonged period of recession and high unemploy-
ment. This article explores the social impact of the economic crisis, focusing on its
effects on altruism using new household-level survey data and quasi-behavioral out-
comes. We focus on the effects of joblessness, the most severe form of economic hard-
ship imposed as a result of the crisis. Our findings reveal a strong relationship between
job loss in the household and decreased altruism. We provide experimental evidence of
these effects and of in-group bias in charitable giving as a result of joblessness. Our
results show that joblessness intensifies survey respondents’preferences for national
as opposed to foreign charities.
Keywords
Altruism, austerity, joblessness, solidarity
Corresponding author:
Nicholas Sambanis, Department of Political Science, University of Pennsylvania,133 S. 36th Street, Philadelphia,
PA 19104, USA.
Email: sambanis@upenn.edu
Article
European Union Politics
2022, Vol. 23(4) 567–589
© The Author(s) 2022
Article reuse guidelines:
sagepub.com/journals-permissions
DOI: 10.1177/14651165221120527
journals.sagepub.com/home/eup
Introduction
In 2009, Greece’s government announced that its budget deficit was 12.9% of the coun-
try’s GDP, four times the 3% limit mandated by the European Union (EU). The
announcement marked the beginning of a sharp period of fiscal adjustment during
which austerity policies were implemented to reduce the deficit and promote growth.
Partly due to these policies and to problems and delays related to their implementation,
Greece went into 5 years of recession, GDP dropped by 25% and the official unemploy-
ment rate jumped to 27%. The painful adjustment period turned public opinion against
Greece’s creditors and delegitimized the political establishment. The public’s reaction
to austerity policies and their economic consequences has been extensively analyzed;
however, their social impact is less well understood. This article explores the social con-
sequences of the European sovereign debt crisis in Greece with a focus on the effects of
economic hardship on group solidarity. Specifically, we ask whether the experience of
joblessness in the context of an economic crisis makes individuals more or less altruistic
toward others.
Greece’s debt crisis led to a sharp increase in unemployment starting in 2010. We take
advantage of this unexpected rise in unemployment to study the social impact of the eco-
nomic crisis. Using data from a face-to-face survey of a representative sample of Greek
households (the 2016 round of the Life in Transition Survey (LiTS) funded by the
European Bank for Reconstruction and Development (EBRD) and the World Bank),
we provide the first systematic analysis of the effects of economic austerity on altruism
in Greece. More broadly, we contribute to the literature on economic determinants of pro-
social behavior, of which altruism is an established type. We measure altruism with char-
itable giving and provide experimental evidence on in-group bias in altruistic behavior as
a function of exposure to joblessness.
Our analysis is informed by psychological theories of behavior, including perspectives
that connect joblessness to resentment and polarization. The psychological effects of
unemployment on individuals are increasingly recognized in the literature. Joblessness
has been linked to mental health impairment, and that impairment is even greater for indi-
viduals who lose their jobs relative to those who have never had recent work experience
(Batic-Mujanovic et al., 2017; Paul and Moser, 2009). This article broadens the scope of
these investigations and considers the impact of joblessness on social polarization and
altruism in Greece.
We argue that joblessness reduces altruism. Joblessness is experienced as an excep-
tionally severe hardship in the context of an economic downturn, exposing affected indi-
viduals to disproportionate risks relative to the rest of the population. This asymmetric
risk exposure weakens the bonds with the rest of the in-group. The opposite pattern is
likely to occur in crises that generate shared risks, such as natural disasters (Savala,
2018; Tierney, 2007) or international wars which bring people together by virtue of
being exposed to a common threat that reduces the perceived distance separating indivi-
duals in a given group. By contrast, joblessness is felt as a “targeted”hardship that sepa-
rates the affected individuals from the group, increasing their social and economic
isolation. Individual-specific risks due to joblessness make class cleavages and other
568 European Union Politics 23(4)
To continue reading
Request your trial