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Economic development, growth, institutions and geography

Author

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  • Bhupatiraju S.
  • Verspagen B.

    (UNU-MERIT)

Abstract

In this paper, we test the Rodrik et al 2004 framework to explain differences in development levels across countries by using a broader set of definitions for institutions, geography and economic variables. We use a multi-faceted database to measure institutions in an attempt to go beyond the single-dimension measures that are often employed. We find that institutions trump other factors geography and trade when we use GDP per capita as an independent variable. When we expand the dependent variable to include other aspects of development, such as growth and investment, we find that institutions, growth and geography are all important variables. In this case, institutions no longer trump the other factors. In this case, we also find that the same institutions variable that was positively associated to GDP per capita is now negatively correlated with the more dynamic development variable.

Suggested Citation

  • Bhupatiraju S. & Verspagen B., 2013. "Economic development, growth, institutions and geography," MERIT Working Papers 2013-056, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    • Handle: RePEc:unm:unumer:2013056
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    References listed on IDEAS

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    Cited by:

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    2. Muhammad Azam, 2022. "Governance and Economic Growth: Evidence from 14 Latin America and Caribbean Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 13(2), pages 1470-1495, June.

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    More about this item

    Keywords

    Economic Development; Financial Markets; Saving and Capital Investment; Corporate Finance and Governance; Formal and Informal Sectors; Shadow Economy; Institutional Arrangements;
    All these keywords.

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements

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