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Governance and Growth: A Simple Hypothesis Explaining Cross-Country Differences in Productivity Growth

Abstract

Cross-country evidence shows that a subset of developing countries isgrowing very rapidly, taking advantage of opportunities to ``catch-up'' atthe same time that other developing countries are growing slowly. We arguethat this is due to differences in the quality of governance. Inparticular we show that productivity growth is higher in better-governedcountries.

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Olson, M., Sarna, N. & Swamy, A.V. Governance and Growth: A Simple Hypothesis Explaining Cross-Country Differences in Productivity Growth. Public Choice 102, 341–364 (2000). https://doi.org/10.1023/A:1005067115159

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Keywords

  • Public Finance
  • Productivity Growth
  • Simple Hypothesis