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Economic Growth and Institutions in Africa: A Cross-Country Time Series Analysis
... Previous research on economic growth and institutions have typically fallen under five broad categories: (1) institutional quality measures, (2) social capital measures, (3) social characteristics, (4) political characteristics, and (5) political instability (Aron, 2000). In the institutional quality measures category, most of the research (Knack andKeefer, 1995, 1997;Clague, et al., 1996;Barro, 1996;Hassan and Sarna, 1996;Knack, 1996;and Lane and Tornell, 1996) involves the security of property and contract rights. Mauro (1995) and Helliwell (1996) examined the relationship of the judicial system and political and social stability with economic growth. ...
... De Vanssay and Spindler (1992) used nineteen constitutional variables, such as the rights to privacy and to unionize, and whether a supreme court exists with final constitutional authority, to study their effects on economic growth. Many studies (Murphy, Schleifer, and Vishny, 1991;Alesina and Rodrik, 1994;Persson and Tabellini, 1994;Ojo and Oshikoya, 1994;Sachs and Warner, 1995;Caselli, Esquivel, and Lefort, 1996;Levine and Zervos, 1996;Alesina and Perotti, 1994;Hassan and Sarna, 1996) have examined how political instability affects economic growth. These studies used factors such as the number of revolutions, coup attempts, political assassinations, riots and demonstrations, and violent deaths per million people as proxies for political instability. ...
The development of countries in economic transition is often misunderstood. These countries are neither underdeveloped nor are they developed, they are somewhere in between. Therefore, macroeconomic models of transitional economies must include aspects of both underdeveloped and developed countries. Two such variables that should be included are institutions and learning-by-doing. Institutions that are established in the society are important because they can either hinder or accelerate economic growth. Just as important for transitional economies is learning-by-doing, as it takes time to learn how a new economic system works. This paper presents a macroeconomic model for transitional economies that extends the Augmented Solow Growth Model to incorporate learning-by-doing and institutions.
... Among the main institutional determinants within this group it is possible to identify: colonial heritage (La Porta et al., 1997Porta et al., , 1998Porta et al., , 1999Acemoglu et al., 2001;Acemoglu and Robinson, 2012;Egermann and Sokoloff, 2002); political conflict (Bates, 2001;Herbst, 2000;Nugent and Robinson, 2002); beliefs and norms (North, 1994(North, , 2005Grief, 1994); ethnolinguistic fractionalization (Perotti, 1996;Easterly and Levine, 1997); sociopolitical instability (Alesina and Perotti, 1996). The second group uses economic institutional measures such as business risk indicators (Knack and Keefer, 1995;Lane and Tornell, 1996;Hassan and Sarna, 1996), economic freedom indexes (Ng and Yeats, 1999), trade openness (Dollar and Kraay, 2003), institutional investor risk rating of default on sovereign debt (Clague et al., 1996), and capital flows (Oliva and Rivera--Batiz, 2002), among others. ...
... Ng and Yeats (1999); Bhagwati (1988); Krueger (1983); Sachs and Warner (1995); Frankel and Romer (1999). Property Rights Knack and Keefer (1995, 1997a, 1997b); Barro (1996); Hassan and Sarna (1996); Knack (1996); Lane and Tornell (1996); Sachs and Warner (1995); Borner, et al. (1995); Brunetti et al. (1998); Clague et al. (1995 Clague et al. ( , 1996); Goldsmith (1995). Corruption Mauro (1995); Clague et al. (1996); Helliwell (1996a); Knack and Keefer (1997a). ...
We thank The Heritage Foundation (especially Gerald O'Driscoll, Aaron Schavey and Ana Eiras) for compiling the data used in their Index of Economic Freedom. Thanks are due also to Freedom House, The World Bank and Angus Maddison for painstaking data compilation. Daron Acemoglu pointed us to some very useful historical data. Larry Diamond helped us immensely by correcting our sample of democratic and anti-democratic events. We are also grateful for constructive comments and suggestions from participants at the 2002 Alamos Alliance, the UCLA Marschak Colloquium and the development workshop in the UCLA department of economics.
... Ng and Yeats (1999); Bhagwati (1988); Krueger (1983); Sachs and Warner (1995); Frankel and Romer (1999). Property Rights Knack and Keefer (1995, 1997a, 1997b); Barro (1996); Hassan and Sarna (1996); Knack (1996); Lane and Tornell (1996); Sachs and Warner (1995); Borner, et al. (1995); Brunetti et al. (1998); Clague et al. (1995 Clague et al. ( , 1996); Goldsmith (1995). Corruption Mauro (1995); Clague et al. (1996); Helliwell (1996a); Knack and Keefer (1997a). ...
Annual income/capita varies across countries of the world by a factor of almost 100. Past literature has often associated income with culture, geography, history, and religion, but these cannot be easily changed. We seek to uncover mutable determinants of income. There is good news. More than 80% of the cross-country variation in per capita income can be explained by mutable determinants. Among these are property rights, black market activity, regulation, civil liberties, press freedom, government spending, trade barriers, inflation, and political rights. Data for five recent years 1995-99 were used in this determination. To check that these factors were causes and not the effects of high income, the trajectories of income before and after democratic and anti-democratic events were traced using data over the past half century. After a democratic event, income rises on average dramatically while the reverse is true after an anti-democratic event. We conclude that countries can develop faster by enforcing strong property rights, fostering an independent judiciary, attacking corruption, dismantling burdensome regulation, allowing press freedom, and protecting political rights and civil liberties. These features define a healthy environment for economic activity. Trade per se is not causative, but rather follows after the establishment of these conditions.
Bu calismanin amaci kurumsal yapinin ekonomik buyume uzerindeki etkisini tespit etmektir. Bu amacla, bu calismada 2002-2005 yillarini kapsayan bir donem icin, kurumsal yapinin ekonomik buyume uzerindeki etkisi Turkiye’nin de icinde yer aldigi 36 ust orta gelir duzeyindeki ulke ornekleminde "Panel Veri Analizi" kullanilarak ekonometrik acidan incelenmektedir. Analiz sonuclari, kurumsal yapi gostergelerinden ifade ozgurlugu ve seffaflik, politik istikrar, duzenlemelerin kalitesi ve hukukun ustunlugu degiskenlerinin ekonomik buyume uzerinde negatif, yonetimin etkinligi ve yolsuzlugun onlenmesi degiskenlerinin ise ekonomik buyume uzerinde pozitif bir etkiye sahip oldugunu gostermektedir.
This paper integrates North's institutional framework with the notion of institutions in the augmented Solow growth model, to clarify the direct and indirect channels by which institutions influence growth. Four ways to extend the Solow model in order to incorporate a rôle for institutions are outlined; and growth regressions are reinterpreted in this light. A detailed typology of empirical institutional measures is provided, and, emphasising measures of institutional quality, evidence from the growth and institutions literature is reviewed. A substantial case is made for the need for a more structural multi-equation modelling approach to determine the effects of diverse institutional measures on growth. The analysis underlines the important rôle of the state in facilitating the development and enforcement of complex, multi-agent and multi-period contracts, refraining from predatory actions which discourage saving, investment and production and in extending civil and political rights that promote the development of social capital.
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