01790cas a2200253 a 4500 AALejournalIMF006986 230101c9999 xx r poo 0 0eng d 5.00 USD 9781455211906 1018-5941 BD-DhAAL BD-DhAAL Aisen, Ari. How Does Political Instability Affect Economic Growth? / Ari Aisen, Francisco Jose Veiga. Washington, D.C. : International Monetary Fund, 2011. 1 online resource (28 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students The purpose of this paper is to empirically determine the effects of political instability on economic growth. Using the system-GMM estimator for linear dynamic panel data models on a sample covering up to 169 countries, and 5-year periods from 1960 to 2004, we find that higher degrees of political instability are associated with lower growth rates of GDP per capita. Regarding the channels of transmission, we find that political instability adversely affects growth by lowering the rates of productivity growth and, to a smaller degree, physical and human capital accumulation. Finally, economic freedom and ethnic homogeneity are beneficial to growth, while democracy may have a small negative effect. Mode of access: Internet Veiga, Francisco Jose. IMF Working Papers; Working Paper ; No. 2011/012 Full text available on IMF http://elibrary.imf.org/view/journals/001/2011/012/001.2011.issue-012-en.xml IMF e-Library