Political stability as a risk factor in global markets

Noel Pavel Jeutang, Kwabena Kesse and Brian C. Payne

Finance Research Letters, 2025, vol. 73, issue C

Abstract: Using a unique and comprehensive measure of political stability, we evaluate the relationship between countries’ political stability and stock market performance around the world from 2000 to 2022. We find this risk factor is unique relative to other well-established risk factors across emerging and developed markets and that it is a priced risk factor in emerging countries.

Keywords: Political stability; Risk factor; Global returns; International markets (search for similar items in EconPapers)
JEL-codes: E62 F30 G15 G18 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:73:y:2025:i:c:s1544612324016878

DOI: 10.1016/j.frl.2024.106658

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