ASSASSINATION AND ECONOMIC PERFORMANCE

Author

Wei Gao, Southern Illinois University CarbondaleFollow

Date of Award

8-1-2011

Degree Name

Doctor of Philosophy

Department

Economics

First Advisor

Gilbert, Scott

Second Advisor

Sylwester, Kevin

Abstract

AN ABSTRACT OF THE DISSERTATION OF WEI GAO, for the Doctor of Philosophy degree in ECONOMICS, presented on JUNE 28th, 2011, at Southern Illinois University Carbondale. TITLE: ASSASSINATION AND ECONOMIC PERFORMANCE MAJOR PROFESSORS: SCOTT GILBERT AND KEVIN SYLWESTER The goal of this dissertation is to investigate how assassination attempts affect economic performances. The challenge is that assassination attempts may not be exogeneous. Thus, I use the outcome of an assassination attempts, success or failure, which is plausibly exogeneous, as the key independent dummy variable to conduct the econometric analysis. This dissertation is composed of three chapters. The first chapter studies whether national leadership shocks affect a country's economic growth. Jones and Olken (2005) find that national leaders' accidental death has impacts on the country's economic growth. Jones and Olken (2009) also find that different outcomes of assassination attempts, success versus failure, matter for the institutions of the country. This chapter follows the methodology in Jones and Olken (2009) to study the impact of different assassination outcomes on economic growth. This chapter finds that basically assassination attempts have no impact on economic growth. But assassination attempts are statistically significant considering two year window. The second chapter studies whether national leadership shocks affect a country's investment. This chapter follows the same methodology in the first chapter to study the impact of different assassination outcomes on investment. The findings in this chapter show that plausibly exogeneous outcome of assassination attempts does not determine the growth of investment or investment level in the country. The result is robust to controlling for different political regimes. The result is also robust to use propensity score approach to separate the effects of successful assassination attempts and unsuccessful ones. The third chapter studies whether national leadership has influence on economic policies. Jones and Olken (2005) find that leaders affect monetary policy and find no persuasive evidence that leaders affect fiscal, trade or security policy. This chapter employs the same methodology in the first two chapters to reexamine the issue. The findings in this chapter find no persuasive evidence that leaders affect fiscal policy or monetary policy. However, there is some evidence that national leaders affect trade policy.