EconPapers    
Economics at your fingertips  
 

How does political instability affect economic growth?

Ari Aisen and Francisco Veiga

Working Papers Central Bank of Chile from Central Bank of Chile

Abstract: The purpose of this paper is to empirically determine the effects of political instability on economic growth. Using the system-GMM estimator for linear dynamic panel data models on a sample covering 169 countries, and 5-year periods from 1960 to 2004, we find that higher degrees of political instability are associated with lower growth rates of GDP per capita. Regarding the channels of transmission, we find that political instability adversely affects growth by slowing productivity growth and, to a smaller degree, physical and human capital accumulation. Finally, economic freedom and ethnic homogeneity are beneficial to growth, while democracy may have a slight negative effect.

Date: 2010-04
New Economics Papers: this item is included in nep-dev, nep-fdg, nep-pol and nep-soc
References: Add references at CitEc
Citations: View citations in EconPapers (12)

Downloads: (external link)
https://www.bcentral.cl/documents/33528/133326/DTBC_568.pdf (application/pdf)

Related works:
Journal Article: How does political instability affect economic growth? (2013) Downloads
Working Paper: How Does Political Instability Affect Economic Growth? (2011) Downloads
Working Paper: How does political instability affect economic growth? (2010) Downloads
Working Paper: How does political instability affect economic growth? (2010) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:chb:bcchwp:568

Access Statistics for this paper

More papers in Working Papers Central Bank of Chile from Central Bank of Chile Contact information at EDIRC.
Bibliographic data for series maintained by Alvaro Castillo (dtbc@bcentral.cl).

 
Page updated 2025-01-05
Handle: RePEc:chb:bcchwp:568