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Civil liberties and economic development

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  • BENYISHAY, ARIEL
  • BETANCOURT, ROGER R.

Abstract

Skepticism prevails among a substantial number of economists over a possible connection between civil liberties and the level of economic activity. Until now, empirical research on economic growth has found mixed evidence on the influence of civil liberties. Disaggregation of the Freedom House Civil Liberties Index allows a fresh empirical look at the effect of human rights on long-term growth or economic development. Our results show that one of the four subcategories of the index outperforms all available indicators of property rights institutions in explaining long-term economic growth. This subcategory, Personal Autonomy and Individual Rights, captures the level of second generation human rights that affect the mobility of individuals with respect to housing, employment and university education, as well as the level of protection of property rights. This result is robust with respect to reverse causation, important omitted variables such as geography and human capital, as well as to a variety of sensitivity tests. We also discuss in our conceptual framework how civil liberties work as an indicator of the prevalence of the rule of law and how the latter affects growth or development as an essential public input.

Suggested Citation

  • Benyishay, Ariel & Betancourt, Roger R., 2010. "Civil liberties and economic development," Journal of Institutional Economics, Cambridge University Press, vol. 6(3), pages 281-304, September.
  • Handle: RePEc:cup:jinsec:v:6:y:2010:i:03:p:281-304_00
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    Cited by:

    1. Rode, Martin & Gwartney, James D., 2012. "Does democratization facilitate economic liberalization?," European Journal of Political Economy, Elsevier, vol. 28(4), pages 607-619.
    2. Ariel BenYishay, 2012. "Informational Barriers to Credit for Migrants: Evidence from Guatemala," Economic Development and Cultural Change, University of Chicago Press, vol. 60(3), pages 535-570.
    3. repec:qba:annpro:v:19:y:2009:id:791 is not listed on IDEAS
    4. BenYishay, Ariel & Betancourt, Roger, 2014. "Unbundling democracy: Political rights and civil liberties," Journal of Comparative Economics, Elsevier, vol. 42(3), pages 552-568.
    5. Martins Iyoboyi & Ummu Ahmad Jalingo & Ahmad Tsauni, 2016. "Impact of Institutions on Macroeconomic Performance in Nigeria: 1980-2013," Eastern European Business and Economics Journal, Eastern European Business and Economics Studies Centre, vol. 2(3), pages 193-221.
    6. repec:eaa:aeinde:v:17:y:2017:i:2_2 is not listed on IDEAS
    7. repec:spr:soinre:v:134:y:2017:i:3:d:10.1007_s11205-016-1466-3 is not listed on IDEAS
    8. Libman, Alexander & Herrmann-Pillath, Carsten & Yadav, Gaurav, 2013. "Are human rights and economic well-being substitutes? The evidence from migration patterns across the Indian states," European Journal of Political Economy, Elsevier, vol. 31(C), pages 139-164.
    9. repec:qba:annpro:v:18:y:2008:id:739 is not listed on IDEAS
    10. Givens, David, 2013. "Defining governance matters: A factor analytic assessment of governance institutions," Journal of Comparative Economics, Elsevier, vol. 41(4), pages 1026-1053.
    11. Bozzoli, Carlos & Müller, Cathérine, 2011. "Perceptions and attitudes following a terrorist shock: Evidence from the UK," European Journal of Political Economy, Elsevier, vol. 27(S1), pages 89-106.

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