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Political Variables in Cross‐country Growth Analysis
Author(s) -
Brunetti Aymo
Publication year - 1997
Publication title -
journal of economic surveys
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.657
H-Index - 92
eISSN - 1467-6419
pISSN - 0950-0804
DOI - 10.1111/1467-6419.00029
Subject(s) - economics , politics , volatility (finance) , boom , variables , democracy , econometrics , political stability , macroeconomics , development economics , public economics , political science , statistics , mathematics , law , environmental engineering , engineering
The recent boom in cross‐country growth analysis has renewed the empirical interest in political sources of economic growth. A large number of studies have tested political variables in growth regressions and a very heterogenous set of variables has been proposed to measure economically relevant differences in the political systems of countries. This paper distinguishes five categories of relevant political variables: democracy, government stability, political violence, policy volatility, and subjective perception of politics. For each of these categories, the specification, testing method, and results of the most relevant studies are presented and are critically discussed. The paper concludes that measures of democracy are least successful and measures of policy volatility and subjective perception of politics most successful as explanatory variables in cross‐country growth regressions.