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The Democracy and Economic Growth Nexus: Empirical Evidence from Côte d’Ivoire

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  • Wadjamsse B. Djezou

Abstract

This paper investigates the relation between economic growth and democracy for Côte d’Ivoire for the period 1960 to 2012. It analyzes both the long-run relation and the direction of causality. To this end, an autoregressive distributed lag (ARDL) model of cointegration and a Granger causality test have been implemented within a vector error correction model (VECM) framework. The results show cointegration in the long run when regime durability is taken into account. Indeed, for economic growth and democracy to move together in the long run, they need to be associated with regime durability. The tests for causality show long run causality running from GDP per capita and regime durability to democracy. In the short run, only the regime durability granger causes democracy. These results suggest that economic growth through strong institutions is a precondition for democratization.

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  • Wadjamsse B. Djezou, 2014. "The Democracy and Economic Growth Nexus: Empirical Evidence from Côte d’Ivoire," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 11(2), pages 251-266, December.
    • Handle: RePEc:liu:liucej:v:11:y:2014:i:2:p:251-266
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    More about this item

    Keywords

    Democracy; Income; Cointegration; Causality;
    All these keywords.

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

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