EconPapers    
Economics at your fingertips  
 

Capital flows and political conflicts: Evidence from Thailand

Pongsak Luangaram and Yuthana Sethapramote ()

Economics of Peace and Security Journal, 2020, vol. 15, issue 2, 83-100

Abstract: How do domestic political conflicts affect capital flows into Thailand? This article advances the current understanding in two ways. First, it adopts a new method for measuring political uncertainty using Thai-language newspapers over the past 20 years. Given that the nature of political conflicts is multi-faceted, these measures cover the various key components of Thai political tensions—both within and outside of parliament. Second, how different types of tensions affect capital flows are examined using a quantile regression framework—allowing an examination of effects upon the overall distribution of capital flows. The empirical results indicate that Thai political conflicts significantly and adversely affect both foreign direct investment and foreign portfolio investment at the left tails of their distribution. The results also highlight how different types of political conflicts affect capital flows in different ways. For example, uncertainty about a military coup and government measures regarding martial law or emergency decrees have a strong negative effect upon foreign direct investment flows; whereas heightened political protest and news about constitutional reform play a significant role in explaining the risk reversal of foreign portfolio investment flows.

Keywords: Capital flows; foreign direct investment; foreign portfolio investment; political uncertainty; Thailand (search for similar items in EconPapers)
JEL-codes: C32 D72 E65 F3 D74 H56 (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://www.epsjournal.org.uk/index.php/EPSJ/article/view/335 (application/pdf)
Open access 24 months after original publication.

Related works:
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:epc:journl:v:15:y:2020:i:2:p:83-100

DOI: 10.15355/epsj.15.2.83

Access Statistics for this article

Economics of Peace and Security Journal is currently edited by Michael Brown and J Paul Dunne

More articles in Economics of Peace and Security Journal from EPS Publishing Contact information at EDIRC.
Bibliographic data for series maintained by Michael Brown, Managing Editor, EPSJ ().

 
Page updated 2021-01-09
Handle: RePEc:epc:journl:v:15:y:2020:i:2:p:83-100