The economic impact of prolonged political instability: a case study of Fiji

Xiaodong Gong and Maheshwar Rao

Policy Studies, 2016, vol. 37, issue 4, 370-386

Abstract: It has been long believed that prolonged political instability harms economic growth and development. This paper contributes to this growing empirical literature by studying the case in Fiji, which has faced a long period of political instability caused by a series of coups, military administrations and frequent changes in government since 1987. The impact of political instability on growth is hard to identify empirically because the counterfactual is unobserved and it is difficult to find valid comparisons. To solve this problem, we use the recently developed Synthetic Control Method to construct a counterfactual (or synthetic Fiji) that predicts the growth of a politically stable Fiji. The difference in per capita growth trajectories of the synthetic and the actual Fiji can thus be attributed as the impacts of political instability. Our findings show that the political instability caused by a series of coups since 1987 has indeed led Fiji onto a lower growth path, and that the accumulated effect is getting larger.

Date: 2016
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/01442872.2016.1157856 (text/html)
Access to full text is restricted to subscribers.

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:taf:cposxx:v:37:y:2016:i:4:p:370-386

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/cpos20

DOI: 10.1080/01442872.2016.1157856

Access Statistics for this article

Policy Studies is currently edited by Toby James

More articles in Policy Studies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().