Wednesday, August 17, 2011

Austerity vs. Instability

"CHAOS is the sum of demonstrations, riots, strikes, assassinations, and attempted revolutions in a single year in each country. The first set of five bars show the frequencies conditional on the size of budget cuts. When expenditure is increasing, the average country-year unit of observation in our data registers less than 1.5 events. When expenditure cuts reach 1% or more of GDP, this grows to nearly 2 events, a relative increase by almost a third compared to the periods of budget expansion. As cuts intensify, the frequency of disturbances rises. Once austerity measures involve expenditure reductions by 5% or more, there are more than 3 events per year and country -- twice as many as in times of expenditure increases."
"This is a rather disturbing chart. Certainly the recent events in England play into the subject of the following paper:

Jacopo Ponticelli, Universitat Pompeu Fabra
Hans-Joachim Voth, UPF-ICREA, CREI and CEPR
Discussion Paper No. 8513
August 2011
Centre for Economic Policy Research"

via Angry Bear



via comments:
""In their conclusion they flatly state: Contrary to what might be expected, we also find no evidence that the spread of mass media facilitates the rise of mass protests."  Not sure why you'd expect otherwise. Some of the most significant riots on record occured before the invention of the telephone, let alone the tweet." J.Goodwin

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