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Growth, Reform indicators and Policy complementarities

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Author Info
Macedo, Jorge Braga de
Martins, Joaquim Oliveira

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Abstract

This paper discusses the design of structural policies by relating second-best results and the complementarity of reforms. It computes a complementarity index based on structural reform indicators compiled by the EBRD for transition countries, assuming that the run-up to EU integration corresponds to a nearly complete policy cycle. Using econometric panel estimates, the level of reforms and changes in their complementarity are found to be positively related to output growth, corrected for endogeneity, and given initial conditions and the extent of macroeconomic stabilisation.

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Paper provided by Universidade Nova de Lisboa, Faculdade de Economia in its series FEUNL Working Paper Series with number wp484.

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Length: 24 pages
Date of creation: 2006
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Handle: RePEc:unl:unlfep:wp484

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  2. Daron Acemoglu, 2005. "Equilibrium Bias of Technology," NBER Working Papers 11845, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  3. Milgrom, Paul & Roberts, John, 1995. "Complementarities and fit strategy, structure, and organizational change in manufacturing," Journal of Accounting and Economics, Elsevier, vol. 19(2-3), pages 179-208, April. [Downloadable!] (restricted)
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  5. Kawamata, Kunio, 1974. "Price Distortion and Potential Welfare," Econometrica, Econometric Society, vol. 42(3), pages 435-60, May. [Downloadable!] (restricted)
  6. Olivier Blanchard & Francesco Giavazzi, 2001. "Macroeconomic Effects of Regulation and Deregulation in Goods and Labor Markets," NBER Working Papers 8120, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  7. Michela Nardo & Michaela Saisana & Andrea Saltelli & Stefano Tarantola & Anders Hoffman & Enrico Giovannini, 2005. "Handbook on Constructing Composite Indicators: Methodology and User Guide," OECD Statistics Working Papers 2005/3, OECD, Statistics Directorate. [Downloadable!]
  8. Rabah Amir, 2005. "Supermodularity and Complementarity in Economics: An Elementary Survey," Southern Economic Journal, Southern Economic Association, vol. 71(3), pages 636-660, January.
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  1. Campos, Nauro F. & Coricelli, Fabrizio, 2009. "Financial Liberalization and Democracy: The Role of Reform Reversals," IZA Discussion Papers 4338, Institute for the Study of Labor (IZA). [Downloadable!]
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