The case of transition economies: what institutions matter for growth?
AbstractThere is a consensus among scholars that institutions (i.e. norms and regulations) are country specific. The paper aims to contribute to the debate by examining the type of institutions which have been the most important for growth in transition countries. It employs a new set of the institutional variables published by the World Bank against the commonly used transition index of the European Bank for Reconstruction and Development. Also, the paper tests the validity of some arguments presented in the institutional literature. As a result, it appears that among the institutional variables government effectiveness has the most significant impact on economic development of the former planned economies. However, at this stage, the classical growth factors such as investment and export turn out to be more important for growth than institutions.
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Bibliographic InfoPaper provided by Economics and Econometrics Research Institute (EERI), Brussels in its series EERI Research Paper Series with number EERI_RP_2011_16.
Date of creation: 16 Nov 2011
Date of revision:
Institutions; governance; transition economies; growth.;
Find related papers by JEL classification:
- O43 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
- P21 - Economic Systems - - Socialist Systems and Transition Economies - - - Planning, Coordination, and Reform
- P36 - Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty
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