Media Freedom, Socio-Political Stability and Investment

32 Pages Posted: 29 May 2011

See all articles by Sudeshna Pal

Sudeshna Pal

Georgia College and State University

Nabamita Dutta

University of Wisconsin - La Crosse

Sanjukta Roy

World Bank Institute

Multiple version iconThere are 2 versions of this paper

Date Written: May 29, 2011

Abstract

Using a panel of 138 countries over 1994-2005 we identify a channel through which a media free from government control promotes domestic investment. We hypothesize that a free media may enhance socio-political stability creating a favorable investment climate that attracts investment. A simultaneous equation model where investment and socio-political stability are jointly determined tests this hypothesis. The method of principal components is applied to various components of socio-political stability to generate a socio-political stability index. Media freedom may promote socio-political stability by making the government more people-oriented and socio-political stability provides a favorable business climate which in turn promotes investment.

Suggested Citation

Pal, Sudeshna and Dutta, Nabamita and Roy, Sanjukta, Media Freedom, Socio-Political Stability and Investment (May 29, 2011). Available at SSRN: https://ssrn.com/abstract=1855332 or http://dx.doi.org/10.2139/ssrn.1855332

Sudeshna Pal

Georgia College and State University ( email )

Milledgeville, GA

Nabamita Dutta (Contact Author)

University of Wisconsin - La Crosse ( email )

1725 State Street
La Crosse, WI 54601
United States

Sanjukta Roy

World Bank Institute ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

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