How Did Economic Success Breed Anti-System Politics? Communities of Fate and Low-Road Firms in the Rise of the Lega Nord
Abstract
Why do far-right, anti-system parties thrive in prosperous regions? This study examines the Lega Nord’s rise in 1990s Northern Italy, challenging the assumption that economic decline drives populism. Leveraging the Veneto Workers History—a dataset of 3.4 million employment records—and electoral data from 576 municipalities, the analysis integrates fixed-effects regression with individual-level modeling of local councillors’ characteristics. Findings reveal that the Lega’s success stemmed not from economic decline but from workplace inequalities, labor market segmentation, and immigrant labor amplifying status threats. Small and medium-sized firms pursuing “low-road” strategies fostered “communities of fate” that united workers and business owners around exclusionary, nativist narratives. Local councillors from firms with higher inequality and greater immigrant presence were more likely to represent the Lega. This study demonstrates how firm-level dynamics and grassroots mobilization translate socio-economic tensions into political instability. By combining granular workplace data with political outcomes, it offers new insights into the structural conditions enabling far-right populism to evolve from fringe movements into entrenched political forces.
