A Deeper Look Into Political Instability and Economic Growth: Case Study and Empirical Analysis on a Selection of Countries

Abstract

The purpose of the study is to investigate the nature of the relationship between political instability and economic growth in a selection of countries witnessing political instability including Egypt, Tunisia, Algeria, Sudan, Brazil, Turkey and Indonesia, during the era (1994-2019). Research methods include country case study analysis of macroeconomic indicators and an empirical analysis, to determine whether political instability plays a significant and important role in the different dimensions of economic growth measured by the Human Development Index, Gross Domestic Product GDP, and gross fixed capital formation. Findings prove a significant negative relationship between political instability and economic growth statistically and economically. Recommendations highlight the importance of transmission channels that enforce the significant negative relationship between political instability and economic development.