Advanced Search
MyIDEAS: Login

Inclusive Institutions, Innovation and Economic Growth: Estimates for European Countries

Contents:

Author Info

  • d'Agostino, Giorgio
  • Scarlato, Margherita

Abstract

This paper investigates the theoretical and empirical foundations of the links between inclusive institutions, innovation and economic growth. Its first contribution to the literature is to provide a non-scale R&D-based growth model incorporating negative externalities linked to low institutional quality that not only affect the productivity of private and human capital, but also constrain the diffusion of existing technological knowledge. In turn, these negative externalities reduce economic growth. The second contribution of this paper is to run estimates for a sample of European Union countries. Empirical analysis based on pooled long- and short-run estimates confirms the importance of private capital and technology as instruments to increase economic growth in European countries and suggests the existence of a positive relationship between inclusive institutions, innovation and economic growth. The estimates also show that market failures linked to the degree of market competition and to the level of network interaction in the economic system significantly condition the influence of formal institutions on private capital, technology and GDP growth.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://mpra.ub.uni-muenchen.de/43098/
File Function: original version
Download Restriction: no

Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 43098.

as in new window
Length:
Date of creation: 2012
Date of revision:
Handle: RePEc:pra:mprapa:43098

Contact details of provider:
Postal: Schackstr. 4, D-80539 Munich, Germany
Phone: +49-(0)89-2180-2219
Fax: +49-(0)89-2180-3900
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC

Related research

Keywords: Innovation; economic growth models; institutions and growth;

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Paul Lanoie & Jérémy Laurent-Lucchetti & Nick Johnstone & Stefan Ambec, 2007. "Environmental Policy, Innovation and Performance: New Insights on the Porter Hypothesis," CIRANO Working Papers 2007s-19, CIRANO.
  2. A. Rodriguez-Pose & Riccardo Crescenzi, 2006. "R&D, spillovers, innovatoin systems and the genesis of regional growth in Europe," Departmental Working Papers of Economics - University 'Roma Tre' 0067, Department of Economics - University Roma Tre.
  3. Daron Acemoglu & Philippe Aghion & Leonardo Bursztyn & David Hemous, 2009. "The Environment and Directed Technical Change," NBER Working Papers 15451, National Bureau of Economic Research, Inc.
  4. Guido Tabellini, 2006. "Culture and institutions: economic development in the regions of Europe," Levine's Working Paper Archive 321307000000000241, David K. Levine.
  5. Dearmon, Jacob & Grier, Robin, 2011. "Trust and the accumulation of physical and human capital," European Journal of Political Economy, Elsevier, vol. 27(3), pages 507-519, September.
  6. Sabatini, Fabio, 2009. "Social capital as social networks: A new framework for measurement and an empirical analysis of its determinants and consequences," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(3), pages 429-442, June.
  7. Giorgio d’Agostino & John Paul Dunne & Luca Pieroni, 2012. "Corruption, Military Spending And Growth," Defence and Peace Economics, Taylor & Francis Journals, vol. 23(6), pages 591-604, December.
  8. Welsch, Heinz, 2006. "Environment and happiness: Valuation of air pollution using life satisfaction data," Ecological Economics, Elsevier, vol. 58(4), pages 801-813, July.
  9. Dias, Joilson & Tebaldi, Edinaldo, 2012. "Institutions, human capital, and growth: The institutional mechanism," Structural Change and Economic Dynamics, Elsevier, vol. 23(3), pages 300-312.
  10. James A. Robinson & Daron Acemoglu, 2000. "Political Losers as a Barrier to Economic Development," American Economic Review, American Economic Association, vol. 90(2), pages 126-130, May.
  11. Mankiw, N Gregory & Romer, David & Weil, David N, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 107(2), pages 407-37, May.
  12. Philippe Aghion & Peter Howitt, 1990. "A Model of Growth Through Creative Destruction," NBER Working Papers 3223, National Bureau of Economic Research, Inc.
  13. Timo Trimborn & Karl-Josef Koch & Thomas M. Steger, 2004. "Multi-dimensional transitional dynamics : a simple numerical procedure," CER-ETH Economics working paper series 04/35, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
  14. Jérôme Silva & Femke de Keulenaer & Nick Johnstone, 2012. "Environmental Quality and Life Satisfaction: Evidence Based on Micro-Data," OECD Environment Working Papers 44, OECD Publishing.
  15. Carmignani, Fabrizio, 2009. "The distributive effects of institutional quality when government stability is endogenous," European Journal of Political Economy, Elsevier, vol. 25(4), pages 409-421, December.
  16. d'Agostino, Giorgio & Scarlato, Margherita, 2011. "Innovation, Growth and Quality of Life: a Theoretical Model and an Estimate for the Italian Regions," MPRA Paper 31939, University Library of Munich, Germany.
  17. Pieroni, Luca & d'Agostino, Giorgio, 2009. "Corruption and the Effects of Economic Freedom," MPRA Paper 18731, University Library of Munich, Germany.
  18. Thomas Farole & Andrés Rodríguez-Pose & Michael Storper, 2010. "Cohesion policy in the European Union: Growth, geography, institutions," Working Papers 2010-14, Instituto Madrileño de Estudios Avanzados (IMDEA) Ciencias Sociales.
  19. Fabio Sabatini, 2009. "The relationship between trust and networks. An exploratory empirical analysis," Economics Bulletin, AccessEcon, vol. 29(2), pages 661-672.
  20. Akçomak, I. Semih & ter Weel, Bas, 2008. "Social Capital, Innovation and Growth: Evidence from Europe," IZA Discussion Papers 3341, Institute for the Study of Labor (IZA).
  21. B. Dettori & E. Marrocu & R. Paci, 2008. "Total factor productivity, intangible assets and spatial dependence in the European regions," Working Paper CRENoS 200823, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  22. Steve Bond & Asli Leblebicioglu & Fabio Schiantarelli, 2010. "Capital accumulation and growth: a new look at the empirical evidence," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 25(7), pages 1073-1099, November/.
  23. Daron Acemoglu & Simon Johnson & James A. Robinson, 2000. "The Colonial Origins of Comparative Development: An Empirical Investigation," NBER Working Papers 7771, National Bureau of Economic Research, Inc.
  24. Zak, Paul J & Knack, Stephen, 2001. "Trust and Growth," Economic Journal, Royal Economic Society, vol. 111(470), pages 295-321, April.
  25. Timothy Besley & Torsten Persson, 2007. "The Origins of State Capacity: Property Rights, Taxation, and Politics," NBER Working Papers 13028, National Bureau of Economic Research, Inc.
  26. Stephen L. Parente & Rui Zhao, 2006. "Slow Development And Special Interests," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 47(3), pages 991-1011, 08.
  27. Eicher, Theo S. & Turnovsky, Stephen J., 2001. "Transitional dynamics in a two-sector non-scale growth model," Journal of Economic Dynamics and Control, Elsevier, vol. 25(1-2), pages 85-113, January.
  28. Elias Dinopoulos & Constantinos Syropoulos, 2007. "Rent Protection as a Barrier to Innovation and Growth," Economic Theory, Springer, vol. 32(2), pages 309-332, August.
  29. Hug, Simon & Spörri, Franziska, 2011. "Referendums, trust, and tax evasion," European Journal of Political Economy, Elsevier, vol. 27(1), pages 120-131, March.
  30. Blomstrom, Magnus & Lipsey, Robert E & Zejan, Mario, 1996. "Is Fixed Investment the Key to Economic Growth," The Quarterly Journal of Economics, MIT Press, vol. 111(1), pages 269-76, February.
  31. Dias, Joilson & McDermott, John, 2006. "Institutions, education, and development: The role of entrepreneurs," Journal of Development Economics, Elsevier, vol. 80(2), pages 299-328, August.
  32. Edinaldo Tebaldi & Bruce Elmslie, 2013. "Does institutional quality impact innovation? Evidence from cross-country patent grant data," Applied Economics, Taylor & Francis Journals, vol. 45(7), pages 887-900, March.
  33. Abhijit Banerjee & Lakshmi Iyer, 2010. "History Institutions and Economic Performance: The Legacy of Colonial Land Tenure Systems in India," Working Papers id:2811, eSocialSciences.
  34. Dionysia Lambiri & Bianca Biagi & Vicente Royuela, 2007. "Quality of Life in the Economic and Urban Economic Literature," Social Indicators Research, Springer, vol. 84(1), pages 1-25, October.
  35. Abhijit V. Banerjee & Esther Duflo, 2000. "Inequality and Growth: What Can the Data Say?," NBER Working Papers 7793, National Bureau of Economic Research, Inc.
  36. Rost, Katja, 2011. "The strength of strong ties in the creation of innovation," Research Policy, Elsevier, vol. 40(4), pages 588-604, May.
  37. Knack, Stephen & Keefer, Philip, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1251-88, November.
  38. Theo S. Eicher & Stephen J. Turnovsky & Uwe Walz, 2000. "Optimal Policy for Financial Market Liberalizations: Decentralization and Capital Flow Reversals," German Economic Review, Verein für Socialpolitik, vol. 1(1), pages 19-42, 02.
  39. Cecilia García-Peñalosa & Jean-François Wen, 2008. "Redistribution and entrepreneurship with Schumpeterian growth," Journal of Economic Growth, Springer, vol. 13(1), pages 57-80, March.
  40. Jones, Charles I, 1995. "Time Series Tests of Endogenous Growth Models," The Quarterly Journal of Economics, MIT Press, vol. 110(2), pages 495-525, May.
  41. Pietro Peretto & Sjak Smulders, 2002. "Technological Distance, Growth And Scale Effects," Economic Journal, Royal Economic Society, vol. 112(481), pages 603-624, July.
  42. Ben S. Bernanke & Kenneth Rogoff, 2001. "NBER Macroeconomics Annual 2000, Volume 15," NBER Books, National Bureau of Economic Research, Inc, number bern01-1, October.
  43. Daron Acemoglu, 2012. "The World our Grandchildren Will Inherit: The Rights Revolution and Beyond," NBER Working Papers 17994, National Bureau of Economic Research, Inc.
  44. Ethier, Wilfred J, 1982. "National and International Returns to Scale in the Modern Theory of International Trade," American Economic Review, American Economic Association, vol. 72(3), pages 389-405, June.
  45. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
  46. Tobias J. Moskowitz & Annette Vissing-Jørgensen, 2002. "The Returns to Entrepreneurial Investment: A Private Equity Premium Puzzle?," American Economic Review, American Economic Association, vol. 92(4), pages 745-778, September.
  47. Tobias J. Moskowitz & Annette Vissing-Jorgensen, 2002. "The Returns to Entrepreneurial Investment: A Private Equity Premium Puzzle?," NBER Working Papers 8876, National Bureau of Economic Research, Inc.
  48. Andrés Rodríguez-Pose & Riccardo Crescenzi, 2008. "Research and development, spillovers, innovation systems, and the genesis of regional growth in Europe," LSE Research Online Documents on Economics 23326, London School of Economics and Political Science, LSE Library.
  49. Christian Bjørnskov, 2010. "How does social trust lead to better governance? An attempt to separate electoral and bureaucratic mechanisms," Public Choice, Springer, vol. 144(1), pages 323-346, July.
  50. Barbosa, Natália & Faria, Ana Paula, 2011. "Innovation across Europe: How important are institutional differences?," Research Policy, Elsevier, vol. 40(9), pages 1157-1169.
  51. Sterlacchini, Alessandro, 2008. "R&D, higher education and regional growth: Uneven linkages among European regions," Research Policy, Elsevier, vol. 37(6-7), pages 1096-1107, July.
  52. Christoph Hauser & Gottfried Tappeiner & Janette Walde, 2007. "The Learning Region: The Impact of Social Capital and Weak Ties on Innovation," Regional Studies, Taylor & Francis Journals, vol. 41(1), pages 75-88.
  53. Ernest Miguélez & Rosina Moreno & Manuel Artís, 2008. "Does social capital reinforce technological inputs in the creation of knowledge? Evidence from the Spanish regions," IREA Working Papers 200813, University of Barcelona, Research Institute of Applied Economics, revised Oct 2008.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:43098. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.