Political Institutions, Technology and Growth: a dynamic panel approach

Izaskun Zuazu

No 16266, IKERLANAK from Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I

Abstract: This paper investigates whether the effect of political institutions on sectoral economic performance is determined by the level of technological development of industries. Building on previous studies on the linkages among political institutions, technology and economic growth, we employ the dynamic panel Generalized Method of Moments (GMM) estimator for a sample of 4,134 country-industries from 61 industries and 89 countries over the 1990-2010 period. Our main findings suggest that changes of political institutions towards higher levels of democracy, political rights and civil liberties enhance economic growth in technologically developed industries. On the contrary, the same institutional changes might retard economic growth of those industries that are below a technological development threshold. Overall, these results give evidence of a technologically conditioned nature of political institutions to be growth-promoting.

Keywords: political; institutions; technological; develogical; development; dynamic; panel; data (search for similar items in EconPapers)
Date: 2015-10
New Economics Papers: this item is included in nep-fdg, nep-gro, nep-ino, nep-pol and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:ehu:ikerla:16266

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Dpto. de Fundamentos del Análisis Económico I, Facultad de CC. Económicas y Empresariales, Universidad del País Vasco, Avda. Lehendakari Aguirre 83, 48015 Bilbao, Spain

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