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Myths and Realities of Long-run Development: A Look at Deeper Determinants

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  • Hasan, Lubna Hasan

Abstract

It has long been realised that factor accumulation and technological development are only proximate causes of economic development, and focus has now shifted to investigating the ‘deeper determinants’ of economic growth. Two such forces are highlighted in literature: institutions and geography. However, it remains controversial as to which of these two is the more important. The “Institutions school” assigns primal importance to institutions, whereas the “Geography school” considers geographical factors as the primary determinant of economic performance of countries. This paper reviews the debate surrounding these “deeper determinants” of economic performance. It reviews the work of these two schools of thought and their interpretation of the long-run development. The paper then examines the evidence provided by the respective schools in favour of their hypotheses. It concludes in favour of the Institutions hypothesis as the Geography school does not provide a consistent story of long-run development.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 2143.

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Date of creation: 2006
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Handle: RePEc:pra:mprapa:2143

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Keywords: Institutions; Geography; Long-run Development; Determinants of Growth;

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Citations

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Cited by:
  1. Hasan, Lubna, 2010. "Rule of Law, Legal Development and Economic Growth: Perspectives for Pakistan," MPRA Paper 25565, University Library of Munich, Germany.
  2. Hasan, Lubna, 2009. "Disease, Institutions and Underdevelopment," MPRA Paper 16862, University Library of Munich, Germany.
  3. M. Idrees Khawaja & Sajawal Khan, 2009. "Reforming Institutions : Where to Begin?," Microeconomics Working Papers 22981, East Asian Bureau of Economic Research.

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