Premium
Institutions and geography as sources of economic development
Author(s) -
Presbitero Andrea F.
Publication year - 2006
Publication title -
journal of international development
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.533
H-Index - 66
eISSN - 1099-1328
pISSN - 0954-1748
DOI - 10.1002/jid.1225
Subject(s) - endogeneity , corporate governance , order (exchange) , work (physics) , quality (philosophy) , institutional economics , economics , economic geography , economic system , economic growth , regional science , development economics , geography , mechanical engineering , philosophy , neoclassical economics , finance , epistemology , engineering , econometrics
This work investigates the roots of economic development. The debate about the predominance of institutions over geography is far from reaching a firm conclusion, and this analysis highlights the main difficulties that should be addressed in order to find out the real determinants of long‐run economic growth. I argue that the institutional view is not as strong as it may appear: different specifications and different institutional indicators undermine the exclusive importance of institutions. Geographical factors, related to the health and sanitary conditions and to the accessibility to the sea of a country, play a role in economic development, that goes beyond the way in which they shape institutions. The empirical evidence implies that the development policies should be directed to improving not only the quality of governance, but also the sanitary conditions in the least developed countries. However, since there is a lack of accurate indicators and difficult problems of endogeneity, more reliable instruments and indicators of geography and institutions are needed in order to achieve a firm conclusion. Copyright © 2005 John Wiley & Sons, Ltd.