Credit Boom and EU Doom: Financialization and Public Disapproval of the European Union

Abstract

What are the determinants of public attitudes toward the European Union? What causes state publics to reject its influence? We argue that financialization, an understudied phenomenon in relevant literatures, is an important driver of public opinion of the EU. We develop and test a theoretical mechanism showing how financialization-induced economic outcomes foster environments conducive to the rejection of the EU. More specifically, we illustrate how financialization leads to the accumulation of household debt and foreclosure of economic opportunity, both of which increase the salience of perceived ties between economic elites, like financiers, and the EU. We make use of four survey instruments -- the Eurobarometer and European Social Survey at the EU-level and the British Social Attitudes and British Household Panel surveys at the UK-level -- to construct a multilevel model and additional analyses that offer support for our hypothesized mechanism. We supplement these findings with qualitative evidence from the United Kingdom to suggest how financialization sowed the seeds that helped drive the UK's ultimate decision to leave the EU in the Brexit referendum.