The effect of institutions on economic growth: A global analysis based on GMM dynamic panel estimation

Siddiqui, Danish Ahmed; Ahmed, Qazi Masood

doi:10.1016/j.strueco.2012.12.001

Cited by 107 publications

(62 citation statements)

References 49 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Conversely, the positive effects of other governance dynamics are also consistent with some findings in the engaged literature: Yerrabit and Hawkes (2015) for government effectiveness, regulation quality, and economic governance; and Yerrabit and Hawkes (2015) and Gani () for corruption‐control. Moreover, I have confirmed the positive impact of general governance that has been documented in the literature without empirical validity (Cooray ; Fayissa and Nsiah ; Kaufmann, Kraay, and Mastruzzi , ; Siddiquia and Ahmedb ; Yerrabit and Hawkes 2015). Accordingly, conclusions on the positive role of general governance have been based on generalized inferences that are not backed by statistical evidence, since governance dynamics have not been previously bundled.…”

Section: Resultssupporting

confidence: 72%

“…Moreover, this study confirms the positive impact of general governance that has been documented in the literature without empirical validity (see e.g., Cooray ; Fayissa and Nsiah ; Kaufmann, Kraay, and Mastruzzi , ; Siddiquia and Ahmedb ; Yerrabit and Hawkes 2015). Accordingly, conclusions on the positive role of general governance have been based on generalized inferences that are not backed by statistical evidence, since governance dynamics have not been previously bundled.…”

Section: Concluding Implications and Future Directionssupporting

confidence: 85%

“…Corresponding findings show that governance positively influences economic growth, with the effect contingent on income levels. Siddiquia and Ahmedb () provide a global analysis with ordinary least squares and GMM to conclude on a positive relationship between institutions and economic growth.…”

Section: Growth and Governancementioning

confidence: 99%

See 2 more Smart Citations

Determinants of Growth in Fast‐Developing Countries: Evidence from Bundling and Unbundling Institutions

Asongu

2016

Politics & Policy

View full text Add to dashboard Cite

Purpose -We assess growth determinants in the BRICS (Brazil, Russia, India, China and South Africa) and MINT (Mexico, Indonesia, Nigeria and Turkey) fast-developing nations for the period [2001][2002][2003][2004][2005][2006][2007][2008][2009][2010][2011]. Particular emphasis is laid on the bundling and unbundling of ten governance dynamics.Design/methodology/approach-Contemporary and non-contemporary Fixed-and RandomEffects regressions are employed as empirical strategies. GDP growth and real GDP output are used as dependent variables. The governance variables are bundled by means of principal component analysis. Findings-The following are some findings. First, governance is more positively significant in non-contemporary specifications as opposed to contemporary regressions. Second, there is some interesting evidence on the heterogeneity of political governance as a driver. Political governance and its constituents (political stability and voice & accountability) are significantly positive in GDP growth but insignificant in real GDP output regressions. Third, the other governance dynamics are more significant determinants of real GDP output, as opposed to GDP growth. Accordingly, they are insignificant in contemporary regressions and negatively significant in non-contemporary regressions for GDP growth. Fourth, the constituents of economic governance have the highest magnitude in the positive effects of governance dynamics on real GDP output. Practical implications-The following are some practical implications. First, lag determinants are necessary for growth targeting or timing of growth dynamics. Growth drivers for the most part are more significantly determined by past information. Second, political governance is the most important driver of economic growth, with the significance of effects more apparent in non-contemporary regressions. Third, economic governance and institutional governance are more positively predisposed to driving real GDP output than GDP growth.Originality/value-As far as we have reviewed, it is the first study to investigate growth determinants in the BRICS and MINT nations. It has strong implications for other developing countries on the contemporary and non-contemporary dynamics of governance in driving economic prosperity.1 Simplice A. Asongu is Lead economist in the Research Department of the AGDI (asongus@afridev.org). 3JEL Classification: C52; F21; F23; O40 ; P37 Keywords: Economic Growth; emerging countries; governance AcknowledgementWe are highly indebted to Akpan Uduak for sharing his dataset.

show abstract

Section: Resultssupporting

confidence: 72%

Section: Concluding Implications and Future Directionssupporting

confidence: 85%

See 1 more Smart Citation

Determinants of Growth in Fast‐Developing Countries: Evidence from Bundling and Unbundling Institutions

Asongu

2016

Politics & Policy

View full text Add to dashboard Cite

show abstract

“…23 All those countries falling below the threshold Figure 1). As noted by Siddiqui and Ahmed (2013), and Hall and Jones (1999), an advantage of using aggregate indicators is that it cancelled out source-specific error. However, the authors also mention that such gain may come at the expense of loss in specificity and conceptual precision (Knack and Manning, 2000).…”

Section: Main Empirical Resultsmentioning

confidence: 99%

Capital Inflows and Economic Growth: Does the Role of Institutions Matter?

2015

View full text Add to dashboard Cite

Recent evidence shows that institutions figure prominently in explaining the 'Lucas paradox'. Using a threshold regression model, we extend this evidence to a situation where institutions index the relationship between foreign capital inflows and economic growth. We find strong and robust evidence that portfolio equity (including foreign direct investment) and debt inflows have positive effects on growth only in countries with high-quality institutions. Countries that fall below the threshold level of institutional quality record either insignificant or negative effects. This paper provides a possible explanation on the so-called Lucas paradox.

show abstract

“…Hasan & Tucci, 2010;Siddiqui & Ahmed, 2013;Su & Moaniba, 2017b) and sectoral-level analysis (e.g. Bertoni, Colombo, & Grilli, 2011;Colombo, Croce, & Guerini, 2013;Dosi et al, 2015;Onishi, 2013).…”

Section: Dynamic Gmm Approach Using Lags As Instrumentsmentioning

confidence: 99%

Does Reverse Causality Explains the Relationship Between Economic Performance and Technological Diversity?

Moaniba

Lee

2018

Technological and Economic Development of Economy

View full text Add to dashboard Cite

Abstract. Previous studies have highlighted technological innovation as a key instrument for economic development. However, although the relationship between innovation and economic growth has been extensively explored, few studies have investigated the impacts of crucial dimensions of innovation on economic growth. This paper presents one of the first empirical attempts to analyze how the "diversity" aspect of technological progress (or innovation) influences economic performance by considering the possible bidirectional causal effects between these two factors. A series of econometric techniques, including a two-stage-least-squares instrumental variable and dynamic autoregressive distributed lag model, are applied on a dataset of 55 countries. The dataset includes patent data from the United States Patent and Trademark Office and combined macroeconomic data from the World Bank's development indicators and International Monetary Fund's economic outlook databases. The results show that generally, technological diversity does not directly affect economic growth. By contrast, a negative effect of diversity on GDP per capita is observed in nonhigh-income countries. This study contributes to the macroeconomics and innovation management literature by providing an integrated empirical application of various popular firm management theories and a well-known endogenous economic growth theory.

show abstract

The effect of institutions on economic growth: A global analysis based on GMM dynamic panel estimation

Cited by 107 publications

References 49 publications

Determinants of Growth in Fast‐Developing Countries: Evidence from Bundling and Unbundling Institutions

Determinants of Growth in Fast‐Developing Countries: Evidence from Bundling and Unbundling Institutions

Capital Inflows and Economic Growth: Does the Role of Institutions Matter?

Does Reverse Causality Explains the Relationship Between Economic Performance and Technological Diversity?

Contact Info

Product

Resources

About