The Cost of Separatism: Economic Consequences of the 1987-1989 Tibetan Unrests

Abstract

The separatism and its related activities bring enormous economic costs to a society, which is however difficult to be estimated, because it involves both observable ethnic conflicts and unobservable psychological resistance. This paper investigates the economic consequences of the 1987–89 Tibetan Unrests with the synthetic control method and finds that per capita GDP in Tibet might be 27% higher for the period from 1988 to 2007 if the unrests had not happened. In addition, we implement several ‘placebo studies’ and assess the threats to the validity of causal inference to confirm the robustness of this study.
KEYWORDS:

• Synthetic control method (SCM)
• separatism
• 1987–1989 Tibetan unrests
• economic cost
• ethnic antagonism

Description