Poverty and Regime Change Nora Genster and Andrew Tabas

Question Is regime change more frequent in rich or poor countries?

Answer Regime change is more frequent in poor countries

Regimes in Literature Gassebner et al. Boix

Variables GDP growth GDP per capita (purchasing power parity) Inequality Regime Change Independent Dependent

Defining Rich and Poor Median values Income inequality GDP growth % GDP per capita lagged (purchasing power parity)

Frequency of Regime Transition VariablesMedian Value Number of Regime Transitions per POOR Country-year Number of Regime Transitions per Rich Country-year Lgdppcpppc (Logged GDP per capita) Gdpgr1 (GDP growth) Inequal1 (Inequality)

Frequency of Regime Transition

Choosing Case Studies Poor Country-yearRich Country-year Yes Regime Change (1)Quadrant OneQuadrant 2 No Regime Change (2)Quadrant 3Quadrant 4 Poor Country-yearRich Country-year Yes Regime Change (1)Guatemala, 1982South Korea, 1987 No Regime Change (2)YemenSweden

Guatemala, 1982 Regime Change – dictatorship to democracy GDP contraction % Low GDP per capita – High inequality – 46.53

South Korea, 1987 Regime change dictatorship to democracy High GDP growth – 10.62% High GPD per capita – 8.83 Low inequality – 37.61

Yemen and Sweden Sweden Yemen No regime change Consistently high GDP growth and GDP per capita Low inequality No regime change Consistently low GDP growth and GDP per capita High inequality

In Sum… Is regime change more frequency in rich or poor country- years? Regime Change is more frequent in poor-country years Poverty encourages political instability

Expansion Bank’s Conflict Index Bell Curve

Thank you.