Europe's other populist problem

Washington, DC

EUROPEAN voters, looking at Donald Trump's chaotic presidency in the United States and the hard road ahead for a post-Brexit Britain, may be turning away from right-wing populists such as Marine Le Pen in France and Geert Wilders in the Netherlands. But if European governments are to keep their own populists at bay, they will need to implement the substantial structural reforms that are necessary to deliver higher long-term economic growth.

In their 1991 book, The Macroeconomics of Populism in Latin America, the late Rudiger Dornbusch of Massachusetts Institute of Technology and Sebastián Edwards of UCLA furnished the standard definition of economic populism. They describe it as "an approach to economics that emphasises growth and income redistribution and deemphasises the risks of inflation and deficit finance, external constraints, and the reaction of economic agents to aggressive nonmarket policies".