To riot and ruin: protests scar economies long after the teargas has gone
The tragedy is that the biggest economic casualties tend to be the very people taking to the streets
Minnesota is the US state known as the “land of 10,000 lakes” and in Minneapolis, the epicentre of the riots gripping the country, a prime property on the water in the well-to-do suburbs will set buyers back at least $1m (R17m). But those plusher districts like Edina, Minnetonka and Eden Prairie are a different world to Lake Street.
The city’s poorest area is a stone’s throw from where 46-year-old George Floyd met death at the hands of a police officer on May 25. The sometimes violent protests that have engulfed dozens of US cities since then also raise fresh questions over the longer-term impact of rioting, and the economic scars that can linger after the flames and teargas have died down.
Victor Matheson, a professor at the Massachusetts-based College of the Holy Cross, lived in Minneapolis for a decade and is one of the few academics to have seriously studied the after-effects of civil disorder, although he stumbled across the topic by accident. As a sports economist, he was examining the potential impact of a new venue in Los Angeles, the Staples Centre, which now hosts the LA Lakers basketball team. But he kept coming across “this big dip in economic activity that occurred right in 1992, and it just persisted forever”...