The Microeconomic Impact of Political Instability: Firm-Level Evidence from Tunisia - Economic Research Forum (ERF)

The Microeconomic Impact of Political Instability: Firm-Level Evidence from Tunisia

Samer Matta


Date:
September, 2017

NO.
1135

Length:
36 pages

Topic:
D2. Production and Organizations
D7. Analysis of Collective Decision-Making
P2. Socialist Systems and Transitional Economies
O1. Economic Development

This paper explores the impact of political instability on firms. The context of this paper is Tunisia, a country that saw a surge in political instability events after the 2011 Jasmine revolution. Using a new dataset, we show that political instability was a major concern for small and exporting firms as well as for those that were operating in the tourism sector, those that have suffered from vandalism and those that were located in the interior region of Tunisia. Most importantly, we find that political instability was the most damaging constraint to firm growth after the Arab Spring.

ملخص

تستكشف هذه الورقة تأثير عدم الاستقرار السياسي على الشركات. سياق هذه الورقة هو تونس، البلد الذي شهد موجة من أحداث عدم الاستقرار السياسي بعد ثورة الياسمين عام 2011. وباستخدام مجموعة بيانات جديدة، نبين أن عدم الاستقرار السياسي كان مصدر قلق كبير للشركات الصغيرة والمصدرة وكذلك الشركات العاملة في قطاع السياحة وتلك التي عانت من التخريب وتلك التي تقع في المنطقة الداخلية من تونس. والأهم من ذلك، نجد أن عدم الاستقرار السياسي كان العائق الأكثر ضررا للنمو الثابت بعد الربيع العربي

Samer Matta


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