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From Double Diversification to Efficiency and Growth

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  • Gylfason, Thorvaldur

Abstract

The paper discusses economic and political diversification as two sides of the same coin, presenting them as parallel potential determinants of long-run economic efficiency and growth. Three different measures of economic diversification are discussed: the Finger-Kreinin index of export diversification, the Herfindahl-Hirschman index of market concentration, and the Theil index of export diversification. Three measures of political diversification are also discussed: indices of political rights and civil liberties and the Polity2 index of democracy. All six measures of diversification are shown to vary directly with one another as well as with per capita incomes across a large sample of countries.

Suggested Citation

  • Gylfason, Thorvaldur, 2017. "From Double Diversification to Efficiency and Growth," Munich Reprints in Economics 49897, University of Munich, Department of Economics.
    • Handle: RePEc:lmu:muenar:49897
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    Cited by:

    1. Thorvaldur Gylfason, 2019. "Inequality Undermines Democracy and Growth," CESifo Working Paper Series 7486, CESifo.
    2. Seydou Coulibaly, 2019. "Impact of natural resource wealth on non-resource tax revenue mobilization in Africa: Do institutions and economic diversification matter?," Working Papers halshs-02108128, HAL.
    3. Thorvaldur Gylfason & Eduard Hochreiter, 2023. "To Grow or Not to Grow: Belarus and Lithuania," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 65(1), pages 137-167, March.
    4. Thorvaldur Gylfason, 2018. "Political economy, Mr. Churchill, and natural resources," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 31(1), pages 23-34, May.
    5. Seydou Coulibaly, 2019. "Impact of natural resource wealth on non-resource tax revenue mobilization in Africa: Do institutions and economic diversification matter?," CERDI Working papers halshs-02108128, HAL.
    6. Siamand Hesami & Bezhan Rustamov & Husam Rjoub & Wing-Keung Wong, 2020. "Implications of Oil Price Fluctuations for Tourism Receipts: The Case of Oil Exporting Countries," Energies, MDPI, vol. 13(17), pages 1-17, August.
    7. Pittaluga, Giovanni B. & Reghezza, Alessio & Seghezza, Elena, 2020. "Reconsidering the modernization hypothesis: The role of diversified production and interest‐group competition," European Journal of Political Economy, Elsevier, vol. 65(C).

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    JEL classification:

    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth

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