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Governance and economic growth

  • Gradstein, Mark
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    Because protection of property rights cannot be appropriated by any individual, it is widely recognized as being the state's responsibility. Moreover, recent empirical evidence suggests that protection of property rights leads to higher investment levels and faster growth. The extent of property rights protection differs significantly across countries. The author integrates the emergence of property rights within a simple growth framework. Drawing on North (1990), he presents a model where economic performance and enforcement of property rights may reinforce each other.Initial conditions determine the economy's convergence to a high-income or a low-income steady state. Existing empirical evidence offers tentative support for this theory.

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    Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3098.

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    Date of creation: 31 Jul 2003
    Date of revision:
    Handle: RePEc:wbk:wbrwps:3098
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    1. Moselle, Boaz & Polak, Benjamin, 2001. "A Model of a Predatory State," Journal of Law, Economics and Organization, Oxford University Press, vol. 17(1), pages 1-33, April.
    2. Paul Zak, . "Institutions, Property Rights, and Growth," Gruter Institute Working Papers on Law, Economics, and Evolutionary Biology 2-1-1009, Berkeley Electronic Press.
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    6. Paul J. ZAK, 2002. "Institutions, Property Rights and Growth," Discussion Papers (REL - Recherches Economiques de Louvain) 2002014, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    7. Lane, Philip R & Tornell, Aaron, 1996. " Power, Growth, and the Voracity Effect," Journal of Economic Growth, Springer, vol. 1(2), pages 213-41, June.
    8. Tornell, Aaron, 1997. " Economic Growth and Decline with Endogenous Property Rights," Journal of Economic Growth, Springer, vol. 2(3), pages 219-50, September.
    9. Svensson, Jakob, 1998. "Investment, property rights and political instability: Theory and evidence," European Economic Review, Elsevier, vol. 42(7), pages 1317-1341, July.
    10. Paul J. Zak, 2002. "Institutions, Property Rights, and Growth," Recherches économiques de Louvain, De Boeck Université, vol. 68(1), pages 55-73.
    11. Gradstein, Mark, 2002. "Rules, stability, and growth," Journal of Development Economics, Elsevier, vol. 67(2), pages 471-484, April.
    12. Grossman, Herschel I & Kim, Minseong, 1995. "Swords or Plowshares? A Theory of the Security of Claims to Property," Journal of Political Economy, University of Chicago Press, vol. 103(6), pages 1275-88, December.
    13. Robert E. Hall & Charles I. Jones, 1999. "Why Do Some Countries Produce So Much More Output Per Worker Than Others?," The Quarterly Journal of Economics, MIT Press, vol. 114(1), pages 83-116, February.
    14. Kaufmann, Daniel & Kraay, Aart & Zoido-Lobaton, Pablo, 1999. "Governance matters," Policy Research Working Paper Series 2196, The World Bank.
    15. Pranab Bardhan, 1997. "Corruption and Development: A Review of Issues," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1320-1346, September.
    16. Keefer, Philip & Knack, Stephen, 1997. "Why Don't Poor Countries Catch Up? A Cross-National Test of Institutional Explanation," Economic Inquiry, Western Economic Association International, vol. 35(3), pages 590-602, July.
    17. repec:oup:qjecon:v:114:y:1999:i:1:p:83-116 is not listed on IDEAS
    18. Alesina, Alberto & Baqir, Reza & Easterly, William, 1999. "Public goods and ethnic divisions," Policy Research Working Paper Series 2108, The World Bank.
    19. Isaac Ehrlich & Francis T. Lui, 1999. "Bureaucratic Corruption and Endogenous Economic Growth," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages S270-S293, December.
    20. repec:oup:qjecon:v:110:y:1995:i:3:p:681-712 is not listed on IDEAS
    21. repec:oup:qjecon:v:112:y:1997:i:4:p:1251-88 is not listed on IDEAS
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