Oil price shocks, income and democracy

Marcus Brückner, Antonio Ciccone and Andrea Tesei

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: We examine the effect of oil price fluctuations on democratic institutions over the 1960-2007 period. We also exploit the very persistent response of income to oil price fluctuations to study the effect of persistent (oil price-driven) income shocks on democracy. Our results indicate that countries with greater net oil exports over GDP see improvements in democratic institutions following upturns in international oil prices. We estimate that a 1 percentage point increase in per capita GDP growth due to a positive oil price shock increases the Polity democracy score by around 0.2 percentage points on impact and by around 2 percentage points in the long run. The effect on the probability of a democratic transition is around 0.4 percentage points.

Keywords: Democracy; Oil Price Shocks; Persistent Income Shocks (search for similar items in EconPapers)
JEL-codes: O10 P16 (search for similar items in EconPapers)
Date: 2011-02
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Citations: View citations in EconPapers (11)

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Related works:
Working Paper: Oil Price Shocks, Income, and Democracy (2013)
Journal Article: Oil Price Shocks, Income, and Democracy (2012)
Working Paper: Oil Price Shocks, Income, and Democracy (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:1351

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