Consequences of Thailand’s 2006 military coup: Evidence from the synthetic control method

Abstract

In this paper, I study the consequences of Thailand’s 2006 military coup for various dimensions of Thailand’s economy. I use the synthetic control method to construct synthetic Thailand, which represents how Thailand would have been if the 2006 coup had not occurred. There are three main results. First, the synthetic control method does not detect statistically significant changes in real GDP, GDP growth rate, inflation, investment, government spending, exports, imports, labor force participation, unemployment, or financial stability. Second, the 2006 military coup temporarily decreased consumption as a percentage of GDP. Third, the military coup increased military expenditure and international tourism in the short run.