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Both Institutions and Policies Matter but Differently for Different Income Groups of Countries: Determinants of Long-Run Economic Growth Revisited

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  • Lee, Keun
  • Kim, Byung-Yeon

Abstract

Summary This paper revisits the recent debate on the determinants of long-run economic growth with the simple idea that different factors matter at different country groups classified by income levels. This paper improves on the methodology by conducting not only cross-section estimations but also fixed-effects panel and system-GMM estimations. The results suggest that new policy variables such as technology and tertiary education, as well as institutions, matter as the determinants of long-run economic growth. In addition, this paper finds that while secondary education and institution turn out to be important for lower-income countries, an emphasis on technology and higher education appears to be effective in generating growth for the upper middle- and high-income countries but not for the lower middle and low-income countries.

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Bibliographic Info

Article provided by Elsevier in its journal World Development.

Volume (Year): 37 (2009)
Issue (Month): 3 (March)
Pages: 533-549

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Handle: RePEc:eee:wdevel:v:37:y:2009:i:3:p:533-549

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Web page: http://www.elsevier.com/locate/worlddev

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Keywords: economic growth institution technology policies income levels education;

References

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Citations

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Cited by:
  1. Choung, Jae-Yong & Hwang, Hye-Ran & Song, Wichin, 2014. "Transitions of Innovation Activities in Latecomer Countries: An Exploratory Case Study of South Korea," World Development, Elsevier, vol. 54(C), pages 156-167.
  2. Lavopa, Alejandro & Szirmai, Adam, 2012. "Industrialization, employment and poverty," MERIT Working Papers 081, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
  3. Krammer, Sorin, 2010. "Do good institutions enhance the effect of technological spillovers on productivity? Comparative evidence from developed and transition economies," MPRA Paper 53985, University Library of Munich, Germany, revised 07 Feb 2014.
  4. Chun-Li Tsai & Ming-Cheng Hung & Kevin Harriott, 2010. "Human Capital Composition and Economic Growth," Social Indicators Research, Springer, vol. 99(1), pages 41-59, October.
  5. Benos, Nikos & Zotou, Stefania, 2013. "Education and Economic Growth: A Meta-Regression Analysis," MPRA Paper 46143, University Library of Munich, Germany.
  6. Law, Siong Hook & Lim, Thong Cheen & Ismail, Normaz Wana, 2013. "Institutions and economic development: A Granger causality analysis of panel data evidence," Economic Systems, Elsevier, vol. 37(4), pages 610-624.
  7. Nalan Baştürk & Richard Paap & Dick van Dijk, 2012. "Structural differences in economic growth: an endogenous clustering approach," Applied Economics, Taylor & Francis Journals, vol. 44(1), pages 119-134, January.
  8. Castellacci, Fulvio & Natera, Jose Miguel, 2013. "The dynamics of national innovation systems: A panel cointegration analysis of the coevolution between innovative capability and absorptive capacity," Research Policy, Elsevier, vol. 42(3), pages 579-594.
  9. Lee, Keun & Lee, Chung H., 2008. "The miracle to crisis and the mirage of the postcrisis reform in Korea: Assessment after ten years," Journal of Asian Economics, Elsevier, vol. 19(5-6), pages 425-437.
  10. Ana Elisa Gonçalves Pereira & Luciano Nakabashi, 2014. "Factors Of Production, Institutions And Development In Brazil," Anais do XLI Encontro Nacional de Economia [Proceedings of the 41th Brazilian Economics Meeting] 090, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
  11. Lee, Keun, 2009. "How Can Korea be a Role Model for Catch-up Development?: A .Capability-based View," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
  12. Prabir De, 2010. "Governance, Institutions, and Regional Infrastructure in Asia," Working Papers id:3029, eSocialSciences.
  13. Kim, Yee Kyoung & Lee, Keun & Park, Walter G. & Choo, Kineung, 2012. "Appropriate intellectual property protection and economic growth in countries at different levels of development," Research Policy, Elsevier, vol. 41(2), pages 358-375.
  14. Filippetti, Andrea & Peyrache, Antonio, 2011. "The Patterns of Technological Capabilities of Countries: A Dual Approach using Composite Indicators and Data Envelopment Analysis," World Development, Elsevier, vol. 39(7), pages 1108-1121, July.
  15. Keun Lee and John Mathews, 2013. "Science, technology and innovation for sustainable development," CDP Background Papers 016, United Nations, Department of Economics and Social Affairs.
  16. Demidova, Olga, 2011. "Modeling of public trust in basic social and political institutions: A comparative econometric analysis," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 21(1), pages 114-132.

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