When Social Contracts Fail: The Economic and Investment Implications of Social Protests

PGIM Fixed Income

December 2019

By Francisco Campos-Ortiz, PhD, Latin America Economist, Global Macroeconomic Research; Mehill Marku, Senior Investment Strategist; Giancarlo Perasso, CEEMA Economist, Global Macroeconomic Research; and Cathy Hepworth, CFA, Co-Head, Emerging Markets Debt Team

Throughout various corners of the world, signs of social unrest are surging in both the streets and the ballot boxes. In an attempt to understand the extent to which these developments could affect the economic outlook of the countries involved and to identify fundamental changes in alpha-generating opportunities, this paper begins by establishing a few common characteristics of the protests. It follows with a brief rundown of some of the most talked-about episodes as well as a discussion on the respective macroeconomic and investment implications.




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