8. Post-Coup Institutional Change
8.1 Thrive for More Liberal Economy
8.1.4 Controlled politics
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8.1.4 Controlled politics
Both Thailand and Indonesia, after their relative coups, pivoted their governments in accordance with the Cold War regime. The competition between the United States and the Soviet Union was based in ideological warfare and caused many countries to engage in civil wars. The Communist camp, led by the Soviet Union, funded pro-Communist newspapers, labor unions, and the Communist troops in order to liberate countries from the exploitation of capitalists. In contrast, the United States supported any government that opposed Communist ideology, even if those countries were governed by a military junta or other kind of dictatorship. Many countries faced difficulty in positioning themselves as a neutral country, so if they did not express loyalty to the United States, it was likely they would experience a US-supported coup.
After the 1958 Sarit coup, his administration banned all political parties and labor unions, whereas other post-coup governments had allowed some labor organizations to continue. The labor movement was very active after the 1932 revolution and maintained a good relationship with Pridi. While the labor union intended to cover all ethnic workers in Thailand, when the Chinese workers protested their employers using the support of the Thai labor union, it was suppressed by the police.
The government also set up a labor union to compete with its leftist counterparts.
However, all members were required to be Thai, which stood in contrast to the socialist ideology that all workers were bound together regardless of nationality. The government disbanded the leftist trade unions and established state-sponsored trade unions in their place, following along in the Fascist-style of governing (Tannenbaum, 1969).
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Prior to Indonesia’s transition to the New Order, the army purged the Communists resulting in one of the biggest mass killings in the world. Subsequently, Suharto disbanded the Communist Party of Indonesia, which was the largest communist party outside of the Communist World. The government forced all political parties to merge into three main parties, including the United Development Party (PPP), which aligned with Islamic values; the Indonesian Democratic Party (PDI), which followed Nationalist ideology; and Golkar, which was supported by Suharto.
As Suharto also appointed Supreme Court judges from his circle, his rule was stabilized through power-sharing and exclusion of the left from politics.
9. Conclusion
Indonesia and Thailand experienced military coups that catalyzed institutional changes, improving their stability and policy-making rationality. However, this research does not intend to imply that a coup is a solution for current political and economic problems, as the context has changed drastically. Practices that were utilized during the Cold War are no longer appropriate, as they come with high costs and subdue the people in an effort to improve economic
performance, which mostly benefits those in urban areas. Today, there is no reason to give up freedom to allow a dictatorship to rule, as it will eventually turn to corruption. While it is true that the conglomerates close with the authoritarian governments were able to help facilitate the transformation into a more industrialized economy with high economic growth, in the long run it created inefficiency and severe corruption, canceling out the economic performance and
economic competitiveness. The 1997 Asian Financial Crisis was a result of this problem, regardless of financial deregulation and decreased barriers for foreign direct investment.
In Indonesia, Suharto occupied the role of President for three decades. While this seems to be long-lasting, his rule collapsed due to the 1997 Asian Financial Crisis, which led to an
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economic nightmare for the country. The public pressured his government, forcing Suharto to step down, officially ending his regime. People were delighted to finally have a democracy that separated the army from politics. This transitional period, called 'Reformasi', was led by Habibie.
Although many observers were afraid of the top-down democratization process, Indonesia proved that the transition to democratic rule could occur without military intervention.
In Thailand, the Cold War regime still exists. During the 1992 Bloody May, in which the military-led government used force to suppress mass protests, the King asked for unity even though he had initially approved this coup in order to facilitate political reform. In 1996, the post-military government established the Constitution Draft Committee, but some politicians were reluctant to support the new constitution. Furthermore, the 1997 Asian Financial Crisis had a significantly negative impact on Thailand’s economic situation. Both of these events combined led to a political movement to pressure politicians into approving the new constitution. Finally, the constitution was passed in parliament as it was designed to create political stability. The small parties that made Thai politics unstable were disappearing, and the two main parties occupied the majority of seats in parliament. Thaksin Shinawatra was the first prime minister after the implementation of the 1997 Constitution. As a populist leader, rural people, especially those in Northern and Northeast Thailand, supported him due to his policies of redistribution.
Such policies inevitably challenged the popularity of the King, leading the military to stage a coup to oust Thaksin.
Throughout the decade before the putsch, many scholars predicted that Thailand could transition from an unfree regime to an elected regime. However, it was proven that Thailand is still "the authoritarian regime under the King’s patronage". The vicious cycle of Thai politics returned, but anti-communism was no longer used as the reason for regime maintenance. Instead,
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the justification came from the need to protect the King from disloyal politicians. There were no structural changes as during the Sarit era; only the consolidation of power between the military and the King.
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Population(x1000) 9.04x107 9.44x107 gdppercapita(1960) 1019.19 1066.16 gdppercapita(1961) 1065.52 1063.79 gdppercapita(1962) 1043.46 1052.29 gdppercapita(1963) 983.78 1053.53 gdppercapita(1964) 1000.12 1079.63 Dummy variable of Population(x1000) 2.24 x107 9.54x107 gdppercapita(1953) 935.25 904.56 gdppercapita(1954) 898.44 951.65 gdppercapita(1955) 945.02 927.99 gdppercapita(1956) 929.70 982.80 gdppercapita(1957) 910.15 944.45 Dummy variable ofsuccessful coup
0.25 0.14
polity2 -4.13 -4.13
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Population(x1000) 9.04x107 9.11x107 gdppercapita(1960) 1019.19 1238.05 gdppercapita(1961) 1065.52 1245.78 gdppercapita(1962) 1043.46 1247.74 gdppercapita(1963) 983.78 1273.06 gdppercapita(1964) 1000.12 1304.12 Dummy variable ofsuccessful coup
0 0.0004
Polity index -2.13 -2.25 Openness to trade 0.015618 -2.24673
Table 2b Population(x1000) 2.24x107 2.94x107 gdppercapita(1953) 935.251 908.7191 gdppercapita(1954) 898.4361 943.6195 gdppercapita(1955) 945.0216 933.2054 gdppercapita(1956) 929.6964 962.1787 gdppercapita(1957) 910.154 910.154 Dummy variable of
successful coup
0.25 0.0695 Polity index -4.125 -4.50425
openness 0.0307 0.0211
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Population(x1000) 9.04x107 1.36x107 gdppercapita(1960) 1019.19 1052.34 gdppercapita(1961) 1065.52 1044.44 gdppercapita(1962) 1043.46 1043.53 gdppercapita(1963) 983.78 1037.06 gdppercapita(1964) 1000.12 1060.63 Dummy variable ofsuccessful coup
0 0.016
Polity index -2.13 -1.16 Openness to trade 0.0156 0.0556 US aids 2.79x107 1.08x108 Population(x1000) 2.24x107 1.51x108 gdppercapita(1953) 935.25 909.32 gdppercapita(1954) 898.43 940.44 gdppercapita(1955) 945.02 943.76 gdppercapita(1956) 929.70 958.45 gdppercapita(1957) 910.15 965.54 Dummy variable of
successful coup
0.25 0.013
Polity index -4.125 0.682 openness to trade 0.0307 0.0304 US aids 5.13x107 4.56x107
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Unit Weights Table for Indonesia Country Unit
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Unit Weights Table for Thailand Country Unit
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Unit Weights Table for Indonesia Country Unit
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Table 5b Model 2
Unit Weights Table for Thailand
Country Unit
Weight Afghanistan 0.355
Bolivia 0
Chile 0
Costa Rica 0
Cuba 0
Egypt 0
Haiti 0.278
India 0
Indonesia 0.274
Jordan 0
Lebanon 0
Liberia 0
Mexico 0
Nicaragua 0
Panama 0
Philippines 0.094 Sri Lanka 0
Uruguay 0
Venezuela 0
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Unit Weights Table for Indonesia Country Unit_Weight
Unit Weights Table for Thailand Country Unit_Weight
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Model 1
Figure 1a The Graph of Synthetic Indonesia Figure 1b The Graph of Synthetic Thailand
Note: The left-hand graph shows Indonesian’s log GDP per capita (black) and its synthetic (dash). Covariates used are the pre-intervention averages of post-coup GDP per capita in five years, the GDP per capita growth, the population size, the dummy variable of successful coup, and the polity index.
Model 2
Figure 2a The Graph of Synthetic Indonesia Figure 2b The Graph of Synthetic Thailand
Note: The left-hand graph shows Indonesian’s log GDP per capita (black) and its synthetic (dash). Covariates used are the pre-intervention averages of post-coup GDP per capita in five years, the GDP per capita growth, the population size, the dummy variable of successful coup, the openness to trade, the US aids and the polity index.
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Model 3
Figure 3a The Graph of Synthetic Indonesia Figure 3b The Graph of Synthetic Thailand
Note: The left-hand graph shows Indonesian’s log GDP per capita (black) and its synthetic (dash). Covariates used are the pre-intervention averages of post-coup GDP per capita in five years, the GDP per capita growth, the population size, the dummy variable of successful coup, the openness to trade and the polity index.
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Model 1
Figure 4a log GDP per capita gaps in Indonesia Figure 4b log GDP per capita gaps in Thailand and placebo gaps in 20 countries and placebo gaps in 25 countries
Model 2
Figure 5a log GDP per capita gaps in Indonesia Figure 5b log GDP per capita gaps in Thailand and placebo gaps in 20 countries and placebo gaps in 19 countries
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Model 3
Figure 6a log GDP per capita gaps in Indonesia Figure 6b log GDP per capita gaps in Thailand and placebo gaps in 11 countries and placebo gaps in 11 countries
Note: These left-hand graphs illustrate the difference between Indonesia and its synthetic control together with corresponding effects for the unit in the donor pool, whereas these right-hand graphs show the difference between Thailand and its synthetic control together with corresponding effects for the unit in the donor pool. Grey lines mean the estimated placebo effect for controlled countries and black lines imply the estimated impact of coup d’etat on log GDP per capita.
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Table 7a
Model 1 Estimates of Indonesian coup de ‘tat
year Estimates pvals pvals_std year Estimates pvals pvals_std
1965 0.108213 0.72 0.8 1985 0.578659 0.2 0.24
1966 0.10253 0.76 0.76 1986 0.564396 0.2 0.2
1967 0.043632 0.84 0.92 1987 0.701408 0.04 0.2 1968 0.112523 0.72 0.76 1988 0.784134 0.04 0.16 1969 0.199133 0.56 0.36 1989 0.863938 0.04 0.16 1970 0.280186 0.36 0.2 1990 0.958826 0.04 0.16
1971 0.363346 0.2 0.2 1991 0.99664 0.04 0.12
1972 0.479503 0.2 0.2 1992 1.115546 0.04 0.12
1973 0.536429 0.2 0.16 1993 1.239297 0.04 0.12 1974 0.543364 0.2 0.16 1994 1.343197 0.04 0.12 1975 0.487086 0.2 0.16 1995 1.279554 0.04 0.12
1976 0.524369 0.2 0.2 1996 1.31348 0.04 0.12
1977 0.614501 0.16 0.2 1997 1.317208 0.04 0.12 1978 0.584339 0.12 0.2 1998 1.134354 0.04 0.12 1979 0.633544 0.08 0.12 1999 1.104274 0.04 0.16 1980 0.667709 0.08 0.16 2000 1.136306 0.04 0.16 1981 0.640241 0.16 0.12 2001 1.216235 0.08 0.16 1982 0.528441 0.2 0.28 2002 1.123394 0.08 0.16 1983 0.513606 0.2 0.24 2003 1.088667 0.08 0.2 1984 0.562022 0.16 0.24
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Table 7b
Model 1 Estimates of Thai coup de ‘tat
year estimates pvals pvals_std year estimates pvals pvals_std 1958 0.016173 0.956522 0.956522 1978 0.778735 0.130435 0.130435 1959 0.097269 0.521739 0.304348 1979 0.799974 0.130435 0.130435 1960 0.159616 0.347826 0.217391 1980 0.798066 0.173913 0.130435 1961 0.188809 0.434783 0.217391 1981 0.78823 0.130435 0.130435 1962 0.21531 0.391304 0.217391 1982 0.771221 0.173913 0.130435 1963 0.260085 0.391304 0.173913 1983 0.77826 0.217391 0.130435 1964 0.290262 0.347826 0.217391 1984 0.816217 0.217391 0.130435 1965 0.323024 0.347826 0.130435 1985 0.857487 0.173913 0.130435 1966 0.409946 0.173913 0.086957 1986 0.859305 0.173913 0.173913 1967 0.469959 0.173913 0.130435 1987 1.037625 0.173913 0.130435 1968 0.508995 0.130435 0.130435 1988 1.198433 0.130435 0.130435 1969 0.543394 0.130435 0.130435 1989 1.309793 0.086957 0.130435 1970 0.563134 0.130435 0.130435 1990 1.434806 0.086957 0.130435 1971 0.60624 0.130435 0.130435 1991 1.521193 0.086957 0.130435 1972 0.636047 0.130435 0.130435 1992 1.642012 0.086957 0.130435 1973 0.650382 0.130435 0.173913 1993 1.792259 0.086957 0.130435 1974 0.642616 0.130435 0.173913 1994 1.930147 0.086957 0.130435 1975 0.639168 0.130435 0.173913 1995 1.893282 0.086957 0.130435 1976 0.652805 0.130435 0.173913 1996 1.916056 0.086957 0.130435 1977 0.750634 0.130435 0.130435 1997 1.863536 0.086957 0.130435
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year estimates pvals pvals_std 1999 1.71781 0.086957 0.130435 2000 1.754641 0.086957 0.130435 2001 1.826043 0.086957 0.130435 2002 1.758981 0.086957 0.130435 2003 1.768573 0.086957 0.130435
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Table 8a
Model 2 Estimates of Indonesian coup de ‘tat
year estimates pvals pvals_std year estimates pvals pvals_std
1965 0.103775 0.7 0.75 1985 0.59874 0.2 0.2
1966 0.094346 0.75 0.75 1986 0.58675 0.25 0.25
1967 0.035399 1 1 1987 0.720859 0.15 0.1
1968 0.097587 0.85 0.8 1988 0.798294 0.15 0.15
1969 0.185058 0.5 0.5 1989 0.867664 0.15 0.15
1970 0.258665 0.35 0.3 1990 0.960009 0.05 0.15 1971 0.338084 0.2 0.35 1991 0.997153 0.05 0.15 1972 0.452159 0.15 0.25 1992 1.122784 0.05 0.15
1973 0.50547 0.15 0.15 1993 1.250026 0 0.15
1974 0.51471 0.1 0.15 1994 1.354345 0 0.15
1975 0.457358 0.15 0.2 1995 1.292396 0 0.15
1976 0.499186 0.1 0.15 1996 1.323334 0 0.15
1977 0.590446 0.1 0.1 1997 1.32593 0 0.15
1978 0.567821 0.1 0.15 1998 1.146573 0.05 0.15 1979 0.618418 0.1 0.1 1999 1.117006 0.05 0.2 1980 0.658904 0.15 0.1 2000 1.148184 0.05 0.2 1981 0.632459 0.15 0.15 2001 1.22888 0.05 0.15 1982 0.523338 0.25 0.15 2002 1.137116 0.05 0.2 1983 0.510268 0.3 0.15 2003 1.102197 0.05 0.2 1984 0.571892 0.2 0.15
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Table 8b
Model 2 Estimates of Thai coup de ‘tat
year estimates pvals pvals_std year estimates pvals pvals_std 1958 0.030048 0.882353 0.882353 1978 0.749464 0 0.058824 1959 0.108061 0.411765 0.294118 1979 0.77845 0 0.058824 1960 0.166501 0.235294 0.176471 1980 0.77254 0.117647 0.058824 1961 0.185868 0.235294 0.117647 1981 0.766319 0.058824 0.058824 1962 0.213475 0.235294 0.117647 1982 0.75267 0.117647 0.058824 1963 0.251892 0.235294 0.117647 1983 0.756537 0.117647 0.117647 1964 0.275412 0.352941 0.117647 1984 0.792455 0.058824 0.117647 1965 0.314179 0.294118 0.117647 1985 0.829887 0.058824 0.117647 1966 0.402174 0.176471 0.117647 1986 0.835308 0.058824 0.117647 1967 0.456533 0.117647 0.058824 1987 0.998021 0 0.058824 1968 0.497431 0.058824 0.058824 1988 1.143471 0 0.058824 1969 0.527322 0.058824 0.058824 1989 1.248014 0 0.058824 1970 0.545323 0.058824 0.058824 1990 1.365317 0 0.117647 1971 0.585577 0.058824 0.058824 1991 1.454792 0 0.058824 1972 0.615576 0.058824 0.058824 1992 1.561464 0 0.117647 1973 0.635371 0.058824 0.058824 1993 1.697329 0 0.117647 1974 0.632176 0.058824 0.058824 1994 1.819148 0 0.117647 1975 0.622115 0.058824 0.058824 1995 1.794835 0 0.117647 1976 0.636253 0.058824 0.058824 1996 1.814007 0 0.117647
1977 0.718734 0 0.058824 1997 1.814007 0 0.117647
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year estimates pvals pvals_std
1999 1.60726 0 0.117647
2000 1.642687 0 0.117647 2001 1.642687 0 0.117647 2002 1.649331 0 0.117647 2003 1.659773 0 0.117647
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Table 9a
Model 3 Estimates of Indonesian coup de ‘tat
year estimates pvals pvals_std year estimates pvals pvals_std
1965 0.003368 1 0.888889 1985 0.629809 0 0
1966 -0.06536 0.666667 0.222222 1986 0.66991 0 0 1967 -0.09896 0.666667 0.111111 1987 0.703569 0 0 1968 -0.03865 0.888889 0.555556 1988 0.734518 0 0 1969 0.024521 0.888889 0.666667 1989 0.800399 0 0 1970 0.075545 0.666667 0.333333 1990 0.805063 0 0 1971 0.090561 0.777778 0.222222 1991 0.773545 0 0 1972 0.171296 0.333333 0.111111 1992 0.909358 0 0
1973 0.291694 0 0 1993 0.966022 0 0
1974 0.289667 0 0 1994 1.022801 0 0
1975 0.334491 0 0 1995 1.049173 0 0
1976 0.372751 0 0 1996 1.092961 0 0
1977 0.422181 0 0 1997 1.146113 0 0
1978 0.417701 0 0 1998 1.020465 0 0
1979 0.445106 0.111111 0 1999 1.018479 0 0
1980 0.502396 0.111111 0 2000 1.056826 0 0
1981 0.550536 0.111111 0 2001 1.077113 0 0
1982 0.527951 0.111111 0 2002 1.094448 0 0
1983 0.547155 0 0.111111 2003 1.087451 0 0
1984 0.608665 0 0
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Table 9b
Model 3 Estimates of Thai coup de ‘tat
year estimates pvals pvals_std year estimates pvals pvals_std 1958 -0.02778 0.714286 0.857143 1978 0.657795 0 0
1959 0.074872 0.857143 0.142857 1979 0.672421 0 0
1960 0.120079 0.571429 0 1980 0.636902 0 0.142857
1961 0.149569 0.142857 0 1981 0.668159 0 0.142857
1962 0.171041 0.142857 0 1982 0.740405 0 0
1963 0.267347 0.142857 0 1983 0.761396 0 0
1964 0.302466 0.142857 0 1984 0.788781 0 0
1965 0.372811 0.142857 0 1985 0.820525 0 0
1966 0.470322 0 0 1986 0.850296 0 0
1967 0.537634 0 0 1987 0.923053 0 0
1968 0.555707 0 0 1988 1.006419 0 0
1969 0.555377 0 0 1989 1.078236 0 0
1970 0.546993 0 0 1990 1.149436 0 0
1971 0.535539 0 0 1991 1.216244 0 0
1972 0.518498 0 0 1992 1.313846 0 0
1973 0.530353 0 0 1993 1.373222 0 0
1974 0.522357 0 0 1994 1.459279 0 0
1975 0.552771 0 0 1995 1.489009 0 0
1976 0.569748 0 0 1996 1.488699 0 0
1977 0.614525 0 0 1997 1.441467 0 0
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year estimates pvals pvals_std
1999 1.377289 0 0
2000 1.401921 0 0
2001 1.411297 0 0
2002 1.450631 0 0
2003 1.487896 0 0
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Timeline
The Thai 1933 coup (two coups) The Thai 1947 coup
The Thai 1948 coup The outbreak of Korean war
The Thai 1951 coup The end of Korean war
The outbreak of Vietnam war The Thai 1957 coup
The Thai 1958 coup
The 1965 Indonesian coup
The Thai 1971 coup The end of Vietnam war
The Thai 1976 coup The Thai 1977 coup
The Plaza Accord
The Thai 1991 coup
The 1997 Asian financial crisis
The Thai 2006 coup
The Thai 2014 coup
1932 1942 1952 1962 1972 1982 1992 2002 2012
The 1932 Siamese Revolution
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