Examining macroeconomic determinants of trust in parliament: A dynamic multilevel framework

The extensive literature on political trust has long suggested a link between macroeconomic conditions and public trust in political institutions. However, empirical evidence regarding this relationship remains ambiguous. Conflicting results appear to be related to differences in research design: while cross-sectional studies tend not to find evidence of a link between macroeconomic variables and trust in political institutions, most longitudinal studies do. In this paper, using recent advances in multilevel methodology, we examine both cross-sectional and longitudinal effects of macroeconomic variables on trust in national parliament within a single dynamic multilevel framework. By analyzing all seven waves of the European Social Survey (2002-2014), we demonstrate that declining macroeconomic performance has a negative within-country effect on trust in national parliament. At the same time, we find limited evidence in support of this association at the between-country level. This discrepancy suggests the presence of confounding factors that are unaccounted for in cross-sectional designs. We therefore argue for the importance of examining within-country effects as they provide a more stringent test of causality.