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Perception of political instability in election periods: Evidence from African firms

Antoine Cazals and Florian Leon

Journal of Comparative Economics, 2023, vol. 51, issue 1, 259-276

Abstract: Political instability is a major obstacle to firms' investment and development. This article investigates how elections affect the perception of political instability of African firms. We use a survey-based dataset of approximately 21,500 firms in 33 African countries which we cross with 237 elections between 2004 and 2020. Our econometric strategy allows a detailed identification of election periods and the associated effects. We provide robust evidence of a pre-election increase in the perception of political instability by firms, but no, or limited post-election effects. The perception of political instability by firms is stronger for firms oriented towards foreign markets, in countries with non-democratic institutions or a high risk of conflict.

Keywords: Firms; Perception of political instability; Elections; Africa (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Working Paper: Perception of political instability in election periods: Evidence from African firms (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jcecon:v:51:y:2023:i:1:p:259-276

DOI: 10.1016/j.jce.2022.09.003

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