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The Effects of Convergence in Governance on Capital Accumulation in the Black Sea Economic Cooperation Countries

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  • Ahmet Faruk Aysan

    (Bogaziçi University)

  • Omer Faruk Baykal
  • Marie-Ange Véganzonès –Varoudakis

Abstract

The paper aims to ascertain the effects of governance on investment and vice versa among a sample set of developing countries. In an increasingly interdependent economic system, regions with good governance are considered to be areas of higher investment as a result of further integration and collaborative action among member states. Since its foundation in 1992, Black Sea Economic Cooperation (BSEC) countries have gone through a transition process and to a large extent these were about institutional transformation. Good governance and institutions are an assurance to guarantee property rights and minimize transaction costs, thus creating an environment conducive to investment and growth. To that end, our second aim is to find out the impact that BSEC has given to its member countries regarding convergence of governance institutions. The study is the first attempt in the literature to investigate how regionalization can provide institutional convergence besides economic convergence in the BSEC region.

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  • Ahmet Faruk Aysan & Omer Faruk Baykal & Marie-Ange Véganzonès –Varoudakis, 2011. "The Effects of Convergence in Governance on Capital Accumulation in the Black Sea Economic Cooperation Countries," Working Papers 611, Economic Research Forum, revised 08 Jan 2011.
  • Handle: RePEc:erg:wpaper:611
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    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • P4 - Economic Systems - - Other Economic Systems

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