Inflationary Pressure and Revolutionary Destabilization: Impact Assessment and Comparative Analysis

Abstract

There are some theoretical grounds to expect that general inflation can have an ambiguous effect on the likelihood of the outbreak of revolutionary actions: while high inflation has a positive effect on revolutionary activity, moderate inflation reduces the likelihood of revolution, whereas negative inflation values again increase revolutionary activity. At the same time, many researchers suggest to treat separately food inflation as a significant predictor of the unfolding of revolutionary processes, because food inflation is a much more sensitive macroeconomic indicator that aggravates many social ills, such as poverty, protest sentiments, frustration, socio-economic shocks, etc. The authors, based on modern political science concepts and quantitative calculations, test the corresponding hypotheses. Using a rare event regression model and a set of control variables (the main factors of revolutions, according to modern political science research — GDP per capita, population, share of youth, urbanization, level of education, level of democracy) to obtain more reliable results, the authors come to the conclusion that the general level of inflation does not have a significant impact on the risks of revolutionary destabilization. On the other hand, food inflation does turn out to be a fairly reliable predictor of the beginning of the unfolding of revolutionary processes. Food inflation has a particularly strong impact on low-income groups, so it is powerful destabilizing factor in the least economically developed countries. Furthermore, regionally, food inflation may have the most powerful destabilizing effect in Africa (especially in African cities).