Impact of Political Protests: A case study on Bangladesh
Conflict, political uncertainty and its impact on stock market has been a subject of interest in the literature. However, no study has yet explored the impact of political strikes on stock market outcomes. Political strike -- locally known as Hartal in Bangladesh -- is a different form of conflict than war or street protest, which is recurrent in nature. Using Dhaka Stock Exchange daily trading data of firms for the period 2005-2015 and controlling for a host of variables such as day, month, year, day-of-year trend and firm fixed effects, we find that political strike has a negative and statistically significant impact on stock market return. Our results show that, on the day of a political strike, stock market return drops about 0.14% which is economically sizable. This effect gets pronounced as the frequency of strike increases, based on week, month or year count of occurrences. Impact heterogeneity reveals that large firms are affected more from hartals compared to smaller firms.
To address the question of interest, we wanted to exploit school-level data of exam participation and success in the national board examinations for various years collected from Board of Education and Bangladesh Bureau of Educational Information and Statistics (BANBEIS) (which are Primary School Certification (PSC), Junior School Certification (JSC), Secondary School Certification (SSC) and Higher Secondary School Certification (HSC) conducted by various examination boards in Bangladesh). In early 2015, starting from 5th January to end of March, Bangladesh went through an unprecedented political turmoil,1 with repeated strikes and country-wide blockade for about three consecutive months which tremendously affected the preparation for public examination of the students. Employing school-level data and difference- in-difference set-up, this analysis will document the impact of such a long-standing political disorder and uncertainty on education and human capital in Bangladesh.