What are the consequences of these frequent changes of government on the domestic economy in Thailand? Is political instability likely to have a positive effect on economic growth? Against this background I would like to examine in this paper the extent to which political instability affects the economy in Thailand. First, the concept of political instability and the link to economic growth as presented in recent literature will be explained. A description of the political and economic history of Thailand will follow. After that, the relationship between political instability and economic growth within Thailand will be analysed using selected indicators.
Between 1932 and 1997, Thailand had twenty-four governments, often emerging in the wake of major political crises. During these years, Thailand went through ten coups and sixteen failed coup attempts. Accordingly, the average tenure of a Thai government has been about twenty-four months. The longest survived one hundred months, under Prem Tinsulanonda (16th Prime Minister between 1980 and 1988) the shortest, under Suchinda Kraprayoon (19th Prime Minister between 7 April 1992 and 24 May 1992), only two months.
Historically, Thailand had largely positive growth rates of between five and ten percent. Thailand's economy has grown increasingly over the last 25 years. Except for two major events, the Asian financial crisis in 1997 and the global economic crisis beginning in 2007. However, it can be said that economic growth in recent years has increased, despite the above-average number of changes of government and military coups.
Political instability leads to greater uncertainty for economic actors within instable countries and can lead to fewer investments being made. The investment climate is suffering from violent conflicts such as civil wars, wars between nations, politically motivated attacks, coups d'états. Also frequent changes of government can generate uncertainty.
Table of Contents
- Introduction
- Literature Review
- State of the Art
- The Relationship between Political Instability and Economic Growth
- Analysis of the Political and Economic Situation in Thailand
- Politico-historical Background
- Economical Background
- Analysis of Indicators
- Fragile States Index
- The Worldwide Governance Indicators
- Conclusion
Objectives and Key Themes
This paper aims to analyze the impact of political instability on the Thai economy. It examines the historical context of political changes in Thailand, exploring the relationship between political instability and economic growth. The study utilizes key indicators to assess this relationship and provide a comprehensive understanding of the economic consequences of Thailand's political landscape.
- The historical context of political instability in Thailand.
- The relationship between political instability and economic growth in Thailand.
- Analysis of relevant economic indicators in relation to political stability.
- Assessment of the impact of political instability on investment and economic confidence.
- Examination of Thailand's economic performance despite periods of political upheaval.
Chapter Summaries
Introduction: This chapter sets the stage by highlighting Thailand's history of frequent government changes and coup attempts between 1932 and 1997, averaging a government tenure of only 24 months. Despite this instability, Thailand generally experienced positive economic growth rates of 5-10%, with exceptions being the 1997 Asian financial crisis and the 2007 global economic crisis. The introduction establishes the central question: how has Thailand managed relatively consistent economic growth amidst significant political instability? This question frames the subsequent analysis of the relationship between political instability and economic performance in Thailand.
Literature Review: This section would delve into existing research on the connection between political instability and economic growth. It would explore various theoretical frameworks and empirical studies examining this complex relationship, providing a foundation for the analysis of the Thai case study. The review would likely address different types of political instability (e.g., coups, frequent changes in government) and their varying impacts on economic indicators like investment, growth rates, and consumer confidence. This lays the groundwork for a more nuanced understanding of the specific context of Thailand.
Analysis of the Political and Economic Situation in Thailand: This chapter would provide a detailed overview of the political and economic history of Thailand, serving as the contextual background for the analysis. The politico-historical background would trace significant political events and their impact on the country's development, while the economical background would analyze key economic trends and structural features of the Thai economy. Together, these sections provide a foundation for understanding how political factors have influenced economic performance.
Analysis of Indicators: This chapter would present a quantitative analysis using chosen indicators to measure the relationship between political instability and economic factors. The indicators might include the Fragile States Index (FSI) and the Worldwide Governance Indicators (WGI), comparing their trends with economic variables such as GDP growth, tourism, capital formation, and household consumption expenditure. Statistical analysis would be used to assess the correlation between these variables, providing evidence to support or refute the hypothesized relationship between political instability and economic performance.
Keywords
Political instability, Thailand, economic growth, investment, governance, Fragile States Index, Worldwide Governance Indicators, GDP growth, Asian financial crisis, coup d'état, government changes, economic uncertainty.
Frequently Asked Questions: Analysis of Political Instability and Economic Growth in Thailand
What is the main topic of this paper?
This paper analyzes the impact of political instability on the economic growth of Thailand. It investigates the historical relationship between political events and economic performance in the country.
What are the key themes explored in the paper?
The paper explores the historical context of political instability in Thailand, the relationship between political instability and economic growth, the analysis of relevant economic indicators in relation to political stability, the impact of political instability on investment and economic confidence, and Thailand's economic performance despite political upheavals.
What is the methodology used in the paper?
The paper employs a mixed-methods approach. It uses a literature review to establish the existing research on the topic and a case study focusing on Thailand. Quantitative analysis is performed using indicators like the Fragile States Index and Worldwide Governance Indicators, comparing them with economic variables such as GDP growth, tourism, and investment to assess the correlation between political instability and economic performance.
What indicators are used to measure political instability and economic performance?
The paper utilizes the Fragile States Index (FSI) and the Worldwide Governance Indicators (WGI) to measure political instability. Economic performance is measured using variables such as GDP growth, tourism, capital formation, and household consumption expenditure.
What is the historical context of political instability in Thailand addressed in the paper?
The paper highlights Thailand's history of frequent government changes and coup attempts between 1932 and 1997, with an average government tenure of only 24 months. Despite this, Thailand generally experienced positive economic growth rates, with exceptions during the 1997 Asian financial crisis and the 2007 global economic crisis.
What is the central research question of this paper?
The central question is: How has Thailand managed relatively consistent economic growth amidst significant political instability?
What is included in the literature review section?
The literature review delves into existing research on the connection between political instability and economic growth, exploring theoretical frameworks and empirical studies to provide a foundation for the analysis of the Thai case study. It addresses different types of political instability and their varying impacts on economic indicators.
What does the analysis of the political and economic situation in Thailand entail?
This section provides a detailed overview of Thailand's political and economic history, tracing significant political events and their impact on the country's development, and analyzing key economic trends and structural features of the Thai economy.
How does the paper analyze the indicators?
The analysis of indicators chapter presents a quantitative analysis using statistical methods to assess the correlation between political instability indicators (FSI, WGI) and economic variables (GDP growth, tourism, etc.).
What are the key takeaways from the chapter summaries?
The introduction sets the stage, the literature review provides theoretical background, the analysis of the political and economic situation in Thailand provides context, and the analysis of indicators provides quantitative evidence related to the central research question. The conclusion synthesizes findings.
What are the keywords associated with this paper?
Keywords include: Political instability, Thailand, economic growth, investment, governance, Fragile States Index, Worldwide Governance Indicators, GDP growth, Asian financial crisis, coup d'état, government changes, economic uncertainty.
- Quote paper
- Julius Henke (Author), 2018, Political Instability in Thailand. Which Effects Does it Have on the Economy of the Country?, Munich, GRIN Verlag, https://www.grin.com/document/490002
