Premium
A MODEL OF GROWTH AUGMENTED WITH INSTITUTIONS
Author(s) -
Aixalá José,
Fabro Gema
Publication year - 2007
Publication title -
economic affairs
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.24
H-Index - 18
eISSN - 1468-0270
pISSN - 0265-0665
DOI - 10.1111/j.1468-0270.2007.00758.x
Subject(s) - endogeneity , instrumental variable , estimation , econometrics , economics , sample (material) , simultaneous equations model , growth model , quality (philosophy) , inclusion (mineral) , macroeconomics , social science , sociology , philosophy , chemistry , management , epistemology , chromatography
This paper shows that the inclusion of institutional indicators in a traditional model of growth substantially improves its explanatory capacity. The results have implications for economic policy, because not all the dimensions of institutional quality influence growth to the same extent. A large sample of 165 countries and estimation methods with instrumental variables are used to solve endogeneity problems.