Does Violence Deter Investment, Hinder Economic Growth?

Brazilian Review of Econometrics, Vol. 30, No. 1, 2010

Posted: 19 Feb 2012

See all articles by Paulo R. A. Loureiro

Paulo R. A. Loureiro

University of Brasília- UnB

Emilson C. D. Silva

Georgia Institute of Technology - School of Economics

Date Written: February 16, 2009

Abstract

Using a panel of developed and developing countries, we investigate whether a country's investment and economic growth rate are negatively related to its violence level. Using GMM and Arelano-Bond procedures we found that violence is a strong deterrent to investment and thus hinders economic growth. Furthermore, we use a broader measure of violence that is able to account for civil war and violent deaths not reported as homicides. This broader measure of violence outperforms intentional homicides in explaining the effect of violence on both investment and economic growth.

Keywords: Violence, Life Expectancies, Developing Countries, Investment and Economic Growth

JEL Classification: C23, O1, O11, O5

Suggested Citation

Loureiro, Paulo R. A. and Silva, Emilson C. D., Does Violence Deter Investment, Hinder Economic Growth? (February 16, 2009). Brazilian Review of Econometrics, Vol. 30, No. 1, 2010, Available at SSRN: https://ssrn.com/abstract=2006432

Paulo R. A. Loureiro (Contact Author)

University of Brasília- UnB ( email )

Campus Darcy Ribeiro-Asa Norte 70362-010 - Brasil
Brasilia, DF 70362-010
Brazil

HOME PAGE: http://https://sites.google.com/site/praloureiro/

Emilson C. D. Silva

Georgia Institute of Technology - School of Economics ( email )

Atlanta, GA 30309-0615
United States

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