European security has historically been linked to the expectations-capabilities gap of the European Union (EU) as well as the EU’s role as a normative power reflected by the conscious choices made by European leaderships. Treaties have been the defining parameters of the operational ability, cognitive potential and institutional capacity of Europe to play a normative role in world politics. The Arab Spring phenomenon has illustrated the actual potential of the EU to act in unity. It has also shown that when inherent European idealism clashes with the realities of international politics, securitized idealism becomes the only viable choice. The concept bears a value-fact (security) oxymoron and is based on the need to balance security needs with the desire to spill over democracy in the Arab world.

During Egypt’s Arab Spring, unprecedented popular mobilization and protests brought down Hosni Mubarak’s government and ushered in an era of competition between three groups: elites associated with Mubarak’s National Democratic Party (NDP), the military, and the Islamist Muslim Brotherhood. Street protests continued to play an important role during this power struggle. We show that these protests are associated with differential stock market returns for firms connected to the three groups. Using daily variation in the number of protesters, we document that more intense protests in Tahrir Square are associated with lower stock market valuations for firms connected to the group currently in power relative to non-connected firms, but have no impact on the relative valuations of firms connected to other powerful groups. We further show that activity on social media may have played an important role in mobilizing protesters, but had no direct effect on relative valuations. According to our preferred interpretation, these events provide evidence that, under weak institutions, popular mobilization and protests have a role in restricting the ability of connected firms to capture excess rents.