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The Dynamic Effect of Social and Political Instability on Output: The Role of Reforms
Author:
Mr. Lorenzo E. Bernal-Verdugo null

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,
Davide Furceri null

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Mr. Dominique M. Guillaume
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Series:
IMF Working Papers
Volume/Issue:
Volume 2013: Issue 091
Language:
English
Publication Date:
23 Apr 2013
DOI:
https://doi.org/10.5089/9781484381687.001
ISBN:
9781484381687
ISSN:
1018-5941
Pages:
41
Keywords:
WP; social conflicts; reforms; crisis; growth; governance indicator; adverse regime changes; governance reform; governance data; level of governance; political system; Production growth; Eastern Europe
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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The aim of this paper is to analyze the dynamic effect of social and political instability on output. Using a panel of up to 183 countries from 1980 to 2010, the results of the paper suggest that social conflicts have a significant and negative impact on output in the short-term with the magnitude of the effect being a function of the intensity of political instability. The results also show that the recovery of output over the medium-term depends on the ability of the country to implement, in the aftermath of a social instability episode, reforms aimed at improving the level of governance. The results are robust to different checks and estimation strategies.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund