IDEAS home Printed from
MyIDEAS: Login to save this article or follow this journal

The effect of institutions on economic growth: A global analysis based on GMM dynamic panel estimation

  • Siddiqui, Danish Ahmed
  • Ahmed, Qazi Masood

This study examines how institutional indicators influence economic growth in a theoretical framework proposed by North (1981). Thirty-one indicators each covering 84 countries over a span of 5 years have been used to extract factors based on principal component analysis. Factors based on these indicators are classified as institutional and policy rents, political rents and risk-reducing technologies. These institutional factors are then used in a formal growth model employing panel OLS and GMM-based estimation methodologies. The findings suggest that favorable institutions positively affect economic growth. This study also shows that for a developing country the institutional and policy rent is more important than other two indices that curb political rents and those that reduce transaction risks. This study also highlights the positive complementarities between index of political rents and index of risk-reducing technologies.

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:
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Elsevier in its journal Structural Change and Economic Dynamics.

Volume (Year): 24 (2013)
Issue (Month): C ()
Pages: 18-33

in new window

Handle: RePEc:eee:streco:v:24:y:2013:i:c:p:18-33
Contact details of provider: Web page:

No references listed on IDEAS
You can help add them by filling out this form.

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

When requesting a correction, please mention this item's handle: RePEc:eee:streco:v:24:y:2013:i:c:p:18-33. 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: (Zhang, Lei)

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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.