From Social Contract to Arab Spring: Macroeconomic Adjustment under Regime Change

Joao Ricardo Faria and Peter McAdam ()
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Joao Ricardo Faria: University of Texas at El Paso

No 813, School of Economics Discussion Papers from School of Economics, University of Surrey

Abstract: Following the Arab-Spring protests, we examine macroeconomic interactions between a productive firm and a rent-seeking government characterized by a continuous probability of regime shift. The model is able to rationalize the early growth leaps witnessed in many Arab economies (the “Social Contract”), as well as their subsequent stagnation. Although post-Spring outcomes are judged benevolent, the macroeconomic inheritance is dependent on the earlier transition characteristics. The model thus sheds light on Arab economic evolutions, the shifting preferences and technologies of authorities and the likely success of economic reforms.

JEL-codes: E24 F5 N17 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2013-11
New Economics Papers: this item is included in nep-ara and nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:sur:surrec:0813

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