Asset Market Perspectives on the Israeli-Palestinian Conflict

32 Pages Posted: 29 Dec 2007

See all articles by Asaf Zussman

Asaf Zussman

Hebrew University of Jerusalem - Department of Economics

Noam Zussman

affiliation not provided to SSRN

Morten Ørregaard Nielsen

Queen's University - Department of Economics

Abstract

This paper locates turning points in the Israeli-Palestinian conflict since the late 1980s using asset market data from Israel and the Palestinian Authority (PA). We find that major escalations in violence, such as the outbreak of the Intifada in 2000, lead to significant declines in asset prices in both Israel and the PA. Conversely, major peace initiatives, such as the Oslo accords in 1993 and the Road Map plan in 2003, lead to substantial increases in asset prices on both sides of the conflict. An additional novel finding is that asset markets respond positively to the success of politicians who favor a negotiated settlement to the conflict.

Suggested Citation

Zussman, Asaf and Zussman, Noam and Nielsen, Morten Orregaard, Asset Market Perspectives on the Israeli-Palestinian Conflict. Economica, Vol. 75, Issue 297, pp. 84-115, February 2008, Available at SSRN: https://ssrn.com/abstract=1079187 or http://dx.doi.org/10.1111/j.1468-0335.2007.00607.x

Asaf Zussman (Contact Author)

Hebrew University of Jerusalem - Department of Economics ( email )

Israel

Noam Zussman

affiliation not provided to SSRN

No Address Available

Morten Orregaard Nielsen

Queen's University - Department of Economics ( email )

94 University Avenue
Kingston K7L 3N6, Ontario
Canada

HOME PAGE: http://www.econ.queensu.ca/faculty/nielsen/

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