Economic Crisis and the Breakdown of Democracy in the Interwar Years: A Reassessment

The relationship between economic crisis and democratic breakdown has received renewed attention as a consequence of the financial crisis of 2008. Conventional wisdom has it that the economic crisis of the 1930s triggered democratic breakdown over large swatches of Europe. Some scholars have used this relationship as a baseline for arguing that a renewed economic crisis is likely to have similar effects today.  However, these new analyses tend to ignore that a string of contributions to comparative historical analysis have questioned the relationship between economic crisis and democratic breakdown in the interwar period. The breakdown capacity of economic crisis has to a large extent been based on the German case. But two problems with generalizing from the German case have been highlighted. First, the crisis of the 1930s actually had a harder impact in a number of other European countries – such as the Netherlands and Norway – several of which managed to retain their democratic credentials. Second, democracy had broken down in a number of European countries – Italy and Poland – before the international crisis began in 1929. These objections seem rather convincing. However, a more systematical assessment of the relationship between economic crisis and democratic breakdown is still pending. In this paper, we first review the literature and subsequently carry out a comparative assessment. Against this background, we discuss the likely consequences of economic crisis for democratic breakdown today.