The economic effects of violent conflict: evidence from asset market reactions

Massimo Guidolin and Eliana La Ferrara

No 2005-066, Working Papers from Federal Reserve Bank of St. Louis

Abstract: This paper studies the effects of conflict onset on asset markets applying the event study methodology. We consider a sample of 112 conflicts during the period 1974-2004 and find that a sizeable fraction of them had a significant impact on stock market indices and on major commodity prices. Furthermore, our results suggest that we are more likely to see investor reactions in response to conflicts that occur in highly polarized settings, possibly because the expected duration and intensity of the conflict is higher.

Keywords: Stock exchanges; Prices (search for similar items in EconPapers)
Date: 2005
New Economics Papers: this item is included in nep-fin and nep-fmk
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Citations: View citations in EconPapers (18)

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Journal Article: The economic effects of violent conflict: Evidence from asset market reactions (2010)
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DOI: 10.20955/wp.2005.066

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