Non-Cooperation by popular vote: expectations, foreign intervention and the vote in the 2015 Greek bailout referendum

Abstract

Referenda in Greece and the UK have recently sent shockwaves across Europe. This paper examines this popular challenge to international cooperation in a systematic fashion by focusing on foreign policy referenda in which a non-cooperative vote is associated with large negative externalities. Such high-stakes referenda are unusual because the consequences of a non-cooperative referendum outcome cannot be controlled by the national government but instead depend on whether the other countries accommodate or penalize the non-cooperative vote. This implies that voters’ expectations about the likely reaction abroad will be highly influential for voting behavior. Foreign policymakers can influence these expectations by sending costly signals ahead of the vote, thus trying to sway the vote in favor of cooperation. Using original survey data from a recent high-stakes referendum, the 2015 Greek referendum, we show that expectations about the consequences of a non-cooperative vote had a powerful effect on voting behavior. Leveraging the bank closure in Greece, we also show that costly signals sent by the other member states made voters more pessimistic about the consequences of a no-vote and increased the share of cooperative votes.