Yes, in your case*1 string concatenation requires all characters to be copied, this is a O(N+M) operation (where N and M are the sizes of the input strings). M appends of the same word will trend to O(M^2) time therefor.
You can avoid this quadratic behaviour by using str.join():
word = ''.join(list_of_words)
which only takes O(N) (where N is the total length of the output). Or, if you are repeating a single character, you can use:
word = m * char
You are prepending characters, but building a list first, then reversing it (or using a collections.deque() object to get O(1) prepending behaviour) would still be O(n) complexity, easily beating your O(N^2) choice here.
*1 As of Python 2.4, the CPython implementation avoids creating a new string object when using strA += strB or strA = strA + strB, but this optimisation is both fragile and not portable. Since you use strA = strB + strA (prepending) the optimisation doesn't apply.
