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Democracy, Corruption and Economic Growth Post-Arab Spring in Tunisia and Libya

  • Abdalla Muktad ORCID logo EMAIL logo
Published/Copyright: December 25, 2023

Abstract

This paper uses the synthetic control method to analyze the repercussions of the Arab Spring on the economic growth, corruption levels, and democracy of Tunisia and Libya. The study covered the years 2003–2018, and I utilized panel data from Tunisia, Libya, and 56 developing countries that were unaffected by the Arab revolution. I excluded countries with incomplete data, those directly impacted by the Arab Spring, and countries affected by external shocks like natural disasters or conflicts. All the data used in this analysis was obtained from the World Bank Open Data and the Varieties of Democracy (V-Dem) project. The findings indicate that the Arab Spring had adverse effects on economic growth in both Tunisia and Libya, in comparison to what would have been expected based on their synthetic control counterparts. On the other hand, the results demonstrate a significant increase in democracy and anti-corruption in both countries following the Arab Spring.

JEL Classification: C01; D74; E02; O1; O43; P16

Corresponding author: Abdalla Muktad, Department of Economics, Colorado State University, 1600 W Plum St, Apt 28M, 80523-1019 Fort Collins, CO, USA, E-mail:

Appendices
Table 1.a.:

Country weights of economic growth in the synthetic Tunisia.

Country Weight Country Weight Country Weight Country Weight
Angola 0 Colombia 0 Madagascar 0 Saudi Arabia 0.003
Albania 0 Costa Rica 0 Mexico 0 Senegal 0
United Arab Emirates 0 Ecuador 0 Mozambique 0 Sierra Leone 0
Argentina 0 Gabon 0 Malawi 0 El Salvador 0
Armenia 0 Ghana 0 Malaysia 0.153 Turkey 0
Azerbaijan 0 Guatemala 0 Namibia 0 Tanzania 0
Bangladesh 0 Croatia 0 Nigeria 0 Uganda 0
Bulgaria 0 Hungary 0 Nicaragua 0.283 Uruguay 0
Belarus 0 Indonesia 0 Oman 0.235 Vietnam 0
Bolivia 0 India 0.172 Panama 0 South Africa 0
Brazil 0 Jamaica 0 Peru 0 Zimbabwe 0
Botswana 0 Kazakhstan 0 Poland 0
Chile 0 Kenya 0 Paraguay 0
China 0.155 Kuwait 0 Qatar 0
Cote d’Ivoire 0 Moldova 0 Romania 0
Table 1.b.:

Country weights of economic growth in the synthetic Libya.

Country Weight Country Weight Country Weight Country Weight
Angola 0 Colombia 0 Madagascar 0 Saudi Arabia 0.534
Albania 0 Costa Rica 0 Mexico 0 Senegal 0
United Arab Emirates 0 Ecuador 0 Mozambique 0 Sierra Leone 0
Argentina 0 Gabon 0 Malawi 0 El Salvador 0
Armenia 0.035 Ghana 0 Malaysia 0 Turkey 0
Azerbaijan 0.199 Guatemala 0 Namibia 0 Tanzania 0
Bangladesh 0.019 Croatia 0 Nigeria 0 Uganda 0
Bulgaria 0 Hungary 0 Nicaragua 0 Uruguay 0
Belarus 0 Indonesia 0 Oman 0 Vietnam 0.014
Bolivia 0 India 0 Panama 0 South Africa 0
Brazil 0 Jamaica 0 Peru 0 Zimbabwe 0.114
Botswana 0 Kazakhstan 0 Poland 0
Chile 0 Kenya 0 Paraguay 0
China 0 Kuwait 0.085 Qatar 0
Cote d’Ivoire 0 Moldova 0 Romania 0
Table 2:

Democracy predictor means before the Arab Spring.

Predictors Tunisia Synthetic Tunisia Libya Synthetic Libya
Real GDP per capita 9.11 9.84 9.93 10.07
Life expectancy 4.31 4.29 4.28 4.29
Government expenditure % of GDP 0.17 0.17 0.14 0.18
Female to labor 0.26 0.27 0.33 0.26
Rule of law 0.04 −0.13 −0.94 −0.21
Urban 0.66 0.65 0.77 0.69
Region 1.00 0.61 1.00 0.65
Open 0.96 0.95 0.99 0.86
Population growth 0.93 1.98 1.42 2.21
Democracy (2007) 0.10 0.10 0.04 0.05
Democracy (2005) 0.11 0.11 0.05 0.05
Democracy (2003) 0.11 0.10 0.05 0.05
Table 3.a.:

Country weights of democracy in the synthetic Tunisia.

Country Weight Country Weight Country Weight Country Weight
Angola 0 Colombia 0 Madagascar 0 Saudi Arabia 0.526
Albania 0 Costa Rica 0 Mexico 0 Senegal 0
United Arab Emirates 0 Ecuador 0 Mozambique 0 Sierra Leone 0
Argentina 0 Gabon 0 Malawi 0 El Salvador 0
Armenia 0.088 Ghana 0 Malaysia 0 Turkey 0
Azerbaijan 0 Guatemala 0 Namibia 0 Tanzania 0
Bangladesh 0.020 Croatia 0 Nigeria 0 Uganda 0
Bulgaria 0.003 Hungary 0 Nicaragua 0.044 Uruguay 0
Belarus 0 Indonesia 0 Oman 0.087 Vietnam 0.180
Bolivia 0 India 0 Panama 0 South Africa 0
Brazil 0 Jamaica 0 Peru 0 Zimbabwe 0
Botswana 0 Kazakhstan 0 Poland 0
Chile 0 Kenya 0 Paraguay 0
China 0 Kuwait 0 Qatar 0
Cote d’Ivoire 0 Moldova 0.050 Romania 0
Table 3.b.:

Country weights of democracy in the synthetic Libya.

Country Weight Country Weight Country Weight Country Weight
Angola 0 Colombia 0 Madagascar 0 Saudi Arabia 0.649
Albania 0 Costa Rica 0 Mexico 0 Senegal 0
United Arab Emirates 0 Ecuador 0 Mozambique 0 Sierra Leone 0
Argentina 0 Gabon 0 Malawi 0 El Salvador 0
Armenia 0 Ghana 0 Malaysia 0 Turkey 0
Azerbaijan 0.198 Guatemala 0 Namibia 0 Tanzania 0
Bangladesh 0 Croatia 0 Nigeria 0 Uganda 0
Bulgaria 0 Hungary 0 Nicaragua 0 Uruguay 0
Belarus 0 Indonesia 0 Oman 0 Vietnam 0.032
Bolivia 0 India 0 Panama 0 South Africa 0
Brazil 0 Jamaica 0 Peru 0 Zimbabwe 0
Botswana 0 Kazakhstan 0 Poland 0
Chile 0 Kenya 0 Paraguay 0
China 0.121 Kuwait 0 Qatar 0
Cote d’Ivoire 0 Moldova 0 Romania 0
Table 4:

Corruption predictor means before the Arab Spring.

Predictors Tunisia Synthetic Tunisia Libya Synthetic Libya
Real GDP per capita 9.11 9.26 9.93 9.44
Life expectancy 4.31 4.22 4.28 4.25
Government expenditure % of GDP 0.17 0.13 0.14 0.13
Female to labor 0.26 0.43 0.33 0.41
Rule of law 0.04 −0.50 −0.95 −0.66
Urban 0.66 0.65 0.77 0.58
Region 1.00 0.08 1.00 0.20
Open 0.96 0.82 0.99 0.94
Population growth 0.93 0.99 1.42 1.47
Corruption (2007) 0.85 0.85 0.85 0.85
Corruption (2005) 0.85 0.85 0.85 0.85
Corruption (2003) 0.85 0.85 0.85 0.85
Table 5.a.:

Country weights of corruption in the synthetic Tunisia.

Country Weight Country Weight Country Weight Country Weight
Angola 0 Colombia 0 Madagascar 0.028 Saudi Arabia 0.082
Albania 0 Costa Rica 0 Mexico 0 Senegal 0
United Arab Emirates 0 Ecuador 0 Mozambique 0 Sierra Leone 0
Argentina 0 Gabon 0.242 Malawi 0 El Salvador 0
Armenia 0.380 Ghana 0 Malaysia 0 Turkey 0
Azerbaijan 0.171 Guatemala 0 Namibia 0 Tanzania 0
Bangladesh 0.005 Croatia 0 Nigeria 0 Uganda 0
Bulgaria 0 Hungary 0 Nicaragua 0 Uruguay 0
Belarus 0 Indonesia 0 Oman 0 Vietnam 0
Bolivia 0.012 India 0 Panama 0 South Africa 0
Brazil 0 Jamaica 0 Peru 0 Zimbabwe 0
Botswana 0 Kazakhstan 0 Poland 0 0
Chile 0 Kenya 0 Paraguay 0
China 0 Kuwait 0 Qatar 0
Cote d’Ivoire 0 Moldova 0.080 Romania 0
Table 5.b.:

Country weights of corruption in the synthetic Libya.

Country Weight Country Weight Country Weight Country Weight
Angola 0 Colombia 0 Madagascar 0 Saudi Arabia 0.197
Albania 0.065 Costa Rica 0 Mexico 0 Senegal 0
United Arab Emirates 0 Ecuador 0 Mozambique 0 Sierra Leone 0
Argentina 0 Gabon 0 Malawi 0 El Salvador 0
Armenia 0 Ghana 0 Malaysia 0 Turkey 0
Azerbaijan 0.737 Guatemala 0 Namibia 0 Tanzania 0
Bangladesh 0 Croatia 0 Nigeria 0 Uganda 0
Bulgaria 0 Hungary 0 Nicaragua 0 Uruguay 0
Belarus 0 Indonesia 0 Oman 0 Vietnam 0
Bolivia 0 India 0 Panama 0 South Africa 0
Brazil 0 Jamaica 0 Peru 0 Zimbabwe 0
Botswana 0 Kazakhstan 0 Poland 0
Chile 0 Kenya 0 Paraguay 0
China 0 Kuwait 0 Qatar 0
Cote d’Ivoire 0 Moldova 0 Romania 0
Table 6:

GDP predictor means before the Arab Spring with additional control variables.

Predictors Tunisia Synthetic Tunisia Libya Synthetic Libya
Life expectancy 4.31 4.21 4.28 4.20
Government expenditure % of GDP 0.17 0.16 0.14 0.16
Natural resource % of GDP 0.05 0.06 0.58 0.39
Female to labor 0.26 0.40 0.33 0.32
Rule of law 0.04 0.04 −0.94 −0.38
Urban 0.66 0.52 0.77 0.75
Region 1.00 0.10 1.00 0.40
Open 0.96 0.76 0.99 0.89
Population growth 0.93 1.21 1.42 2.55
Mean years of education 6.03 7.29 6.70 8.16
Oil rent % of GDP 3.96 3.91 56.72 36.62
Unemployment rate 13.16 12.40 19.47 9.96
Income inequality 3.04 4.34 2.79 4.16
Real GDP per capita (2007) 9.15 9.14 9.99 10.00
Real GDP per capita (2005) 9.05 9.05 9.90 9.88
Real GDP per capita (2003) 8.97 8.97 9.77 9.78
Table 7:

Democracy predictor means before the Arab Spring with additional control variables.

Predictors Tunisia Synthetic Tunisia Libya Synthetic Libya
Real GDP per capita 9.11 9.26 9.93 10.29
Life expectancy 4.31 4.14 4.28 4.28
Government expenditure % of GDP 0.17 0.16 0.14 0.19
Natural resource % of GDP 0.05 0.26 0.58 0.43
Female to labor 0.26 0.32 0.33 0.23
Rule of law 0.04 −0.62 −0.94 −0.17
Urban 0.66 0.60 0.77 0.74
Region 1.00 0.48 1.00 0.74
Open 0.96 0.77 0.99 0.88
Population growth 0.93 1.77 1.42 2.47
Mean years of education 6.03 7.73 6.70 8.62
Oil rent % of GDP 3.96 21.19 56.72 40.94
Unemployment rate 13.16 5.74 19.47 5.94
Income inequality 3.04 4.68 2.79 4.75
Democracy (2003) 0.11 0.11 0.05 0.05
Democracy (2005) 0.11 0.11 0.05 0.05
Democracy (2007) 0.10 0.10 0.05 0.05
Table 8:

Corruption predictor means before the Arab Spring with additional control variables.

Predictors Tunisia Synthetic Tunisia Libya Synthetic Libya
Real GDP per capita 9.11 9.11 9.93 9.54
Life expectancy 4.31 4.22 4.28 4.24
Government expenditure % of GDP 0.17 0.12 0.14 0.13
Natural resource % of GDP 0.05 0.11 0.58 0.35
Female to labor 0.26 0.42 0.33 0.41
Rule of law 0.04 −0.54 −0.94 −0.59
Urban 0.66 0.66 0.77 0.63
Region 1 0.02 1.00 0.20
Open 0.96 0.71 0.99 0.93
Population growth 0.93 0.87 1.42 1.78
Mean years of education 6.03 8.32 6.70 9.40
Oil rent % of GDP 3.96 8.85 56.72 32.62
Unemployment rate 13.16 10.85 19.47 8.14
Income inequality 3.04 3.60 2.79 2.93
Real GDP per capita (2003) 0.85 0.85 0.85 0.85
Real GDP per capita (2005) 0.85 0.85 0.85 0.85
Real GDP per capita (2007) 0.85 0.85 0.85 0.85
Figure 1: 
In-space placebo test for democracy in Tunisia and Libya.
Figure 1:

In-space placebo test for democracy in Tunisia and Libya.

Figure 2: 
In-space placebo test for corruption in Tunisia and Libya.
Figure 2:

In-space placebo test for corruption in Tunisia and Libya.

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Received: 2023-09-19
Accepted: 2023-11-27
Published Online: 2023-12-25

© 2023 Walter de Gruyter GmbH, Berlin/Boston

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