Question

The leadership in Peru is not stable. Four of the five past presidents were involved in major corruption scandals or have faced charges for human rights crimes (Fujimori). Does this political instability have a negative impact on the economic growth of the country?

Answer 1

Answer: Yes, political instability have a negative impact on the economic growth for any country. Such countries face burden of election expenses frequently. The new government comes with new rules and regulations which have bad impact on the country's economy. Let's take example of India as its economy is growing rapidly due political stability.

Hence, political stability is one of major cause for economic growth otherwise country have negative impact on economic growth.