Economic Consequences of the Intifada: Investment and Political Instability in Israel

We construct a time-series model of investment in Israel that incorporates both traditional economic factors derived from a theoretical model of a profit-maximising representative firm and indicators of political instability and unrest. This is used to estimate the extent to which the Intifada has depressed Israeli investment and the size of the corresponding "peace dividend".Investment; Political Instability; Israel

Investment, Employment and Political Conflict in Northern Ireland

This paper combines panel data on employment and investment in different types of capital good in Northern Ireland with timeseries data on the level of political conflict (measured in various ways) in order to estimate the extent to which conflict discourages employment and investment of different kinds. While all factors of production are affected by political conflict, the magnitude of the effect varies substantially from one to another.Investment; Employment; Northern Ireland

Why is Africa so poor? A structural model of economic development and income inequality.

The paper extends existing work on inequality and economic development by estimating a cross-country structural model that identifies bi-directional relationships between income inequality and other indicators of social and economic development. Overall, lower inequality is associated with improvements in other development indicators, but this is the result of several complex interactions. The most striking feature of the structural model is the insight it provides into the reasons behind the negative “Africa dummy” in previous cross-country growth studies.income distribution, social and economic development

How Does Civil War Affect the Magnitude of Capital Flight? Evidence from Israel during the Intifada

We use time-series data from Israel to investigate the dynamics of the causal links between the intensity of civil conflict and capital flight. The fraction of Israeli capital wealth held outside the country exhibits considerable variation over time. So also do indicators of the intensity of the Palestinian-Israeli conflict. Using quarterly time-series data, the paper shows that there is a high correlation between the two, conditional on economic conditions. This correlation is a consequence of a causal link that runs in both directions more violence leads to more capital flight, but more capital flight is also a predictor of higher future levels of violence.

Human rights, political instability and investment in South Africa: a note.

This paper extends the model of Fielding (1999), which is designed to explain changes in investment in South Africa during the Apartheid period, by allowing a role for indicators of political instability and political and civil rights, as measured by Fedderke et al. (1999). The conclusions based on estimation of the original model are robust to the inclusion of the political factors, but these factors do explain some of the variation in investment over time.Investment, Social Capability, South Africa

UK Consumers' Expenditure over 40 Years

Using quarterly data for the last four decades, we test a number of traditional assumptions about aggregate consumer behaviour in the UK, with regard to the order of integration of the time series, the income elasticity of consumption and the stability of the parameters of the consumption function. In all cases, modification of these assumptions now appears to be necessary.

Can Political Instability Generate Business Cycles? Evidence from the Intifada

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.Israel; macroeconomics; political instability; VAR

Aid and Dutch Disease in the South Pacific

The impact of aid inflows on relative prices and output is ambiguous. Aid inflows that increase domestic expenditure are likely to cause real exchange rate appreciation, ceteris paribus. However, if this expenditure raises the capital stock in the traded goods sector, then output in this sector might not contract, at least in the steady state. Moreover, if investment in the nontraded goods sector is relatively high and/or productive, then there is not necessarily any real exchange rate appreciation in the steady state. We use time-series data to examine the impact of aid inflows on output and real exchange rates in ten South Pacific island states, and find aid inflows to produce a variety of outcomes in economies of different kinds.aid, Dutch disease, South Pacific

A Structural Model of Social and Economic Development

In this paper we estimate a model of the determinants of economic and social development that takes seriously three of the criticisms of panel data models in the existing growth literature: that long run coefficients are biased because the lagged dependent variable is not strictly exogenous; that they are biased because of slope coefficient heterogeneity; and that they are biased because of explanatory variable endogeneity. The model indicates that there are strong causal relationships in both directions between on the one hand, economic development, and on the other, social and political development.

How Does Monetary Policy Affect the Poor? Evidence from the West African Economic and Monetary Union

The West African Economic and Monetary Union (UEMOA) has a history of monetary stability and low inflation. Nevertheless, there is substantial variation in relative prices within some UEMOA countries, in particular in the price of food relative to other elements of the retail price index (IHPC). Using monthly time-series data for cities within the region, we analyze the impact of changes in monetary policy instruments on the relative prices of components of the IHPC. We are then able to explore how the burden of monetary policy innovations is likely to be shared between the rich and poor.Monetary policy; poverty; Africa