Can Political Instability Generate Business Cycles? Evidence from the Intifada

David Fielding

No 00/9, Discussion Papers in Economics from Division of Economics, School of Business, University of Leicester

Abstract: This paper presents an econometric model that combines macroeconomic time series data with historical series relating to political instability in Israel during the Intifada period, in order to provide a conservative estimate of the extent to which variations in economic performance over time have a political explanation. Political instability is found to have a substantial effect on the cyclical component of aggregate output.

Keywords: Israel; macroeconomics; political instability; VAR (search for similar items in EconPapers)
JEL-codes: E10 K42 O11 O53 (search for similar items in EconPapers)
Date: 2000-11
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