Democracy and Economic Growth
Journal Title: Journal of Business Management & Economics - Year 2017, Vol 5, Issue 6
Abstract
This paper discusses the relationship between regime type and economic development. Since all the developed countries in the world today are all democracies, people may argue that a democracy regime is the essential factor for economic growth. But is this true? Is democracy indeed the cause, or is it actually the consequence of, economic development? This paper utilizes regression analysis to determine the effects of political regime on economic growth. We used OLS random-effects regression and robust regression for panel data, on a data set covering up to 215 countries and regions, and a 55-year period from 1960 to 2014. The vast majority of our analyses did not show a significant democracy variable, thus indicating no statistically-established relationship between democracy and GDP growth. However, the reason behind these results is potentially not straightforward. Countries may become rich under many regime types. The causal effects of social institutions often have cumulative effects, effects that are noticeable only if an institution’s history is brought into consideration. Although there is no consistent relationship between growth and democracy, which belies many people's conventional thinking, our study suggests there is no reason to sacrifice democracy at the altar of development.
Authors and Affiliations
Tianfang Song, Paul D. Berger, Hanjoon Kim
Keywords
Related Articles
- EP ID EP321198
- DOI 10.15520/jbme.2017.vol5.iss6.257.pp14-24
- Views 59
- Downloads 0
Programmatic Marketing via Reinforcement Learning
This new algorithm which incorporates look-ahead search inside the training loop resulting in rapid improvement and precise and stable learning. By using this new search methods towards programmatic marketing, we massive...
Impact of Capital Structure on Insurance Firms’ Perfromance in Nigeria
The study investigates the impact of capital structure on firm’s performance (Insurance companies) in Nigeria for a period of 5 years (2011-2015) for a sample size of 12 insurance companies. Data were collected from the...
The Extent to Which Jordanian External Auditor Comply with the Planning Process for Auditing the Private Jordanian Universities
The study aimed to identify The Extent to Which Jordanian External Auditor Comply with The Planning Process for Auditing The Private Jordanian Universities, a questionnaire has been designed for this purpose, distribute...
Exploratory Factor Analysis Forthe Smes’ Exporting Activitiesin Southern Area of Vietnam
Vietnam has been joined into Word Trade Organization since 2007 and therefore the country needs to take into account a lot of international trading framework but it also brings higher opportunities to explore other marke...
Sharing Economy and Regulation
The sharing of goods and services via Internet platforms is becoming increasingly popular. The article asks the questions and answers whether the sharing economy is, in the first place, from the economic point of view, i...