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Does Governance Matter? Yes, No or Maybe Some Evidence from Developing Asia


  • M. G. Quibria



This paper seeks to explore the relationship between economic growth and governance performance in Asian developing economies. This exploration yields some interesting conclusions. First, notwithstanding its tremendous economic achievements, the state of governance in Asia is not stellar by international comparison. Indeed, a majority of these countries seem to suffer from a governance deficit. Second, contrary to our expectation, data do not suggest any strong positive link between governance and growth : paradoxically, countries that exhibit surpluses in governance on average grew much slower than those with deficits. The paper ends with some conjecture about this apparent paradox.

Suggested Citation

  • M. G. Quibria, 2006. "Does Governance Matter? Yes, No or Maybe Some Evidence from Developing Asia," Development Economics Working Papers 22474, East Asian Bureau of Economic Research.
  • Handle: RePEc:eab:develo:22474

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    References listed on IDEAS

    1. Rodrik, Dani, 2005. "Growth Strategies," Handbook of Economic Growth,in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 14, pages 967-1014 Elsevier.
    2. repec:mes:challe:v:33:y:1990:i:4:p:57-59 is not listed on IDEAS
    4. Edward L. Glaeser & Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 2004. "Do Institutions Cause Growth?," Journal of Economic Growth, Springer, vol. 9(3), pages 271-303, September.
    5. Daniel Kaufmann & Aart Kraay & Massimo Mastruzzi, 2003. "Governance Matters III: Governance Indicators for 1996-2002," Macroeconomics 0308006, EconWPA.
    6. Kaufmann, Daniel, 2003. "Governance Redux: The Empirical Challenge," MPRA Paper 8210, University Library of Munich, Germany.
    7. Steven Radelet, 2004. "Aid Effectiveness and the Millennium Development Goals," Working Papers 39, Center for Global Development.
    8. Quibria, M.G., 2002. "Growth and Poverty: Lessons from the East Asian Miracle Revisited," MPRA Paper 2638, University Library of Munich, Germany.
    9. M. G. Quibria, 2005. "Rethinking Development Effectiveness," World Economics, World Economics, 1 Ivory Square, Plantation Wharf, London, United Kingdom, SW11 3UE, vol. 6(1), pages 101-117, January.
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    Cited by:

    1. Emmanuel S. de Dios & Geoffrey M. Ducanes, 2013. "Institutions and governance," Chapters,in: Asia Rising, chapter 2, pages 49-75 Edward Elgar Publishing.
    2. Amavilah, Voxi & Asongu, Simplice A & Andrés, Antonio R, 2014. "Globalization, Peace & Stability, Governance, and Knowledge Economy," MPRA Paper 58756, University Library of Munich, Germany.
    3. Md Rafayet Alam & Erick Kitenge & Bizuayehu Bedane, 2017. "Government Effectiveness and Economic Growth," Economics Bulletin, AccessEcon, vol. 37(1), pages 222-227.
    4. Quibria, M.G., 2014. "Governance and Developing Asia: Concepts, Measurements, Determinants, and Paradoxes," ADB Economics Working Paper Series 388, Asian Development Bank.
    5. repec:eee:ecmode:v:68:y:2018:i:c:p:205-216 is not listed on IDEAS
    6. Ngobo, Paul Valentin & Fouda, Maurice, 2012. "Is ‘Good’ governance good for business? A cross-national analysis of firms in African countries," Journal of World Business, Elsevier, vol. 47(3), pages 435-449.
    7. Emmanuel S. de Dios & Geoffrey M. Ducanes, 2011. "Investment, institutions, and governance in Asia," UP School of Economics Discussion Papers 201107, University of the Philippines School of Economics.
    8. Koch, Martin, 2012. "International Organizations in Development and Global Inequality: The Example of the World Bank?s Pension Policy," WIDER Working Paper Series 103, World Institute for Development Economic Research (UNU-WIDER).
    9. Daniel Horgos & Klaus W. Zimmermann, 2010. "It Takes Two to Tango: Lobbies and the Political Business Cycle," Kyklos, Wiley Blackwell, vol. 63(3), pages 383-399, August.
    10. Raileanu Szeles, Monica, 2014. "A Multidimensional Approach to the Inclusiveness of economic Growth in the New Member States," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 5-24, June.
    11. Bichaka Fayissa & Fahad Gill, 2016. "Revisiting the growth-governance relationship in developing Asian and Oceanic economies," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 40(4), pages 803-816, October.
    12. Amavilah, Voxi & Asongu, Simplice A. & Andrés, Antonio R., 2017. "Effects of globalization on peace and stability: Implications for governance and the knowledge economy of African countries," Technological Forecasting and Social Change, Elsevier, vol. 122(C), pages 91-103.
    13. Bruno S. Frey & Reiner Eichenberger & René L. Frey, 2009. "Editorial Ruminations: Publishing Kyklos," Kyklos, Wiley Blackwell, vol. 62(2), pages 151-160, April.
    14. Amavilah, Voxi Heinrich, 2009. "Globalization, governance, and the economic performance of Sub-Saharan Africa," MPRA Paper 15600, University Library of Munich, Germany.
    15. Han, Xuehui & Khan, Haider & Zhuang, Juzhong, 2014. "Do Governance Indicators Explain Development Performance? A Cross-Country Analysis," ADB Economics Working Paper Series 417, Asian Development Bank.
    16. Kuheli Dutt, 2009. "Governance, institutions and the environment-income relationship: a cross-country study," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 11(4), pages 705-723, August.
    17. Quibria, M.G & Ahmad, Shafi, 2007. "Aid Effectiveness in Bangladesh," MPRA Paper 10299, University Library of Munich, Germany, revised Sep 2008.
    18. Amavilah, Voxi Heinrich, 2008. "Domestic resources, governance, global links, and the economic performance of Sub-Saharan Africa," MPRA Paper 11193, University Library of Munich, Germany.

    More about this item


    Governance; institutions; Growth and Asia;

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East


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