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| Guilherme Amorim and Marcelo E. A. Silva |
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| ''Governance and growth: A panel VAR approach.'' |
| ( 2023, Vol. 43 No.4 ) |
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| In this paper, we explore the dynamic relationship between economic growth and quality of governance across a wide sample of countries. Using a panel vector autoregression (VAR) approach, we show that shocks to governance quality exert a positive and significant impact on economic growth, one that is sustained for more than ten years after the initial shock. Therefore, our results support the institutional view of economic growth, with better governance fostering higher growth. We also present evidence supporting the idea that higher growth leads to better institutions. |
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| Keywords: Governance, Institutions, Growth, Cross-Country, Panel VAR. |
JEL: O4 - Economic Growth and Aggregate Productivity: General
C5 - Econometric Modeling: General |
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| Manuscript Received : May 04 2023 | | Manuscript Accepted : Dec 30 2023 |
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