Biden could learn one thing from Modi

India's general elections, which will be spread over multiple weeks, kick off on Friday with voting in 102 of the country's 543 constituencies. The outcome of this mammoth exercise is not really in doubt. Prime Minister Narendra Modi has maintained, if not increased, his favorability ratings since he last won re-election in 2019. Such enduring popularity, in an age when most democratically elected leaders are struggling, can appear mystifying.

The standard "pocketbook" argument clearly doesn't explain Modi's success. While India's economy might be posting impressive growth numbers, employment and wages haven't kept up. Government data shows that, for the past decade, Indians' average monthly real earnings have either declined or remained stagnant. Almost half the workforce is still paid below the government-mandated minimum wage. This implies that too few Indians have benefited from Modi's policies for economic reasons alone to account for his popularity.

In fact, while Modi's muscular Hindu nationalist rhetoric is wildly popular, especially in India's north, his economic management may indeed be what is keeping him in power. And the lessons from that success could usefully be studied by leaders elsewhere — especially those, such as US President Joe Biden, who are betting their re-elections on big subsidy-and-spending packages.

Modi's biggest macroeconomic priority hasn't been to juice growth or wages. Instead, he has focused on controlling inflation. Even though his government has not been too keen on independent regulators or institutional reforms, it did push through legislation early on that set an inflation target for India's central bank for the first time. The Reserve Bank of India's six-member monetary policy committee has since been left mostly on its own to manage rates, in spite of occasional grumbling from the finance ministry in New Delhi.

Meanwhile, the government has deployed a mix of macro- and microeconomic levers to keep prices from spiraling out of control, including during supply disruptions brought on by the Covid-19 pandemic. Federal budgets have sought to shrink the deficit. While fuel taxes are high, they have also largely insulated Indians from wild, inflationary swings in energy prices.

The government insists — though without providing much evidence — that trade with Russia after it invaded Ukraine also keeps energy costs down. Even India's attempts at industrial policy have been on the cheap: Elon Musk appears to have been lured to the country by the promise of lower tariffs on Tesla Inc.'s cars, not government handouts.

Not all of the government's anti-inflation efforts have been sensible or responsible. The export of agricultural goods, for example, is frequently shut down at the first sign of higher domestic prices, causing chaos for fragile food supply chains across the developing world. Unpredictable trade policy is one of the reasons that Modi has failed in his promise to double farmers' income. At the same time, this only underscores his willingness to prioritize stable prices over employment and household income growth.

Modi seems to have learned from his predecessors' mistakes. Previous governments failed to manage prices and faced widespread popular discontent as a consequence. Even if their record on growth and wages was better than Modi's, inflation a few percentage points higher than Indians expected quickly sapped those administrations of support.

For politicians seeking office, it may still be "the economy, stupid." But how we think about the interplay between the economy and voting patterns needs to change. The instability of inflation pretty clearly seems to alienate voters from their government far more than a stagnant economy and high unemployment.

US economists such as Paul Krugman have argued that Biden has delivered a "good economy" that isn't being recognized because of "negative vibes," fueled by right-wing media. And it is true that the US continues to see robust job growth: Bidenomics prioritizes full employment over deficit reduction or price-reducing free trade.

Biden's campaign may discover, however, that's not necessarily what makes most voters happy. Lavish government spending and near-shoring efforts have kept US prices high and unpredictable — the true source of the mysterious "vibes" that threaten Biden's re-election. While real incomes may have increased, Americans seem to care even more about nominal prices. That's illogical — but who says voters are rational?

Politicians in the West don't seem to have worked this out. In Europe, leaders faced with restive populations are doubling down on spending packages and industrial subsidies. Meanwhile, polls ahead of this summer's elections to the European Parliament suggest that rising prices are what really concern voters.

Mainstream parties may face a debacle in Europe and Biden might lose in the fall. Meanwhile Modi, despite sky-high youth unemployment and declining real wages, is being rewarded for keeping prices predictable. The lesson of India's polls should reverberate well beyond its borders: Elections are won through stability, not subsidies.

Mihir Sharma is a Bloomberg Opinion columnist. A senior fellow at the Observer Research Foundation in New Delhi, he is the author of 'Restart: The Last Chance for the Indian Economy.'

Disclaimer: This article first appeared on Bloomberg, and is published by a special syndication arrangement.