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Political stability as a risk factor in global markets

Author

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  • Jeutang, Noel Pavel
  • Kesse, Kwabena
  • Payne, Brian C.

Abstract

Using a unique and comprehensive measure of political stability, we evaluate the relationship between countries’ political stability and stock market performance around the world from 2000 to 2022. We find this risk factor is unique relative to other well-established risk factors across emerging and developed markets and that it is a priced risk factor in emerging countries.

Suggested Citation

  • Jeutang, Noel Pavel & Kesse, Kwabena & Payne, Brian C., 2025. "Political stability as a risk factor in global markets," Finance Research Letters, Elsevier, vol. 73(C).
    • Handle: RePEc:eee:finlet:v:73:y:2025:i:c:s1544612324016878
    DOI: 10.1016/j.frl.2024.106658
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    More about this item

    Keywords

    Political stability; Risk factor; Global returns; International markets;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • F30 - International Economics - - International Finance - - - General
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation

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