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Social divisions and institutions: Assessing institutional parameter variation

  • Isaksson, Ann-Sofie

    ()

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

This paper investigates the hypothesis that the association between property rights institutions and income is weaker in countries with high social divisions. It argues that social divisions should have a negative effect on perceived institutional inclusiveness, which in turn should depress institutional payoffs. Absent a property rights indicator that captures the perceived inclusiveness of institutions, social divisions should then weaken the observed association between property rights institutions and income. The empirical results support this hypothesis, and highlight the importance of evaluating whether the institutions measure used captures the institutional framework applying to the population at large.

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File URL: http://hdl.handle.net/2077/9503
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Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 282.

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Length: 27 pages
Date of creation: 01 Feb 2008
Date of revision: 01 Aug 2008
Handle: RePEc:hhs:gunwpe:0282
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Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden

Phone: 031-773 10 00
Web page: http://www.handels.gu.se/econ/

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