EconPapers    
Economics at your fingertips  
 

Institutional equilibrium in EU economies in 2008 and 2018: SEM-PLS models

Borkowski Mateusz ()
Additional contact information
Borkowski Mateusz: Doctoral School in the Social Sciences (economics and finance), University of Bialystok, Bialystok, Poland

Statistics in Transition New Series, 2022, vol. 23, issue 2, 107-127

Abstract: The aim of the research is to identify the strength and direction of the development of the relationship between formal and informal institutions and to assess the institutional equilibrium of modern economies. The structural equations modelling based on partial least squares (SEM-PLS) is applied to achieve the purpose of the article. It is an econometric method that allows the measurement and analysis of the dependencies between latent variables (measures that cannot be directly observed). The study included 27 EU economies and the research period covered the years 2008 and 2018. The results of the study demonstrate that the quality of informal institutions strongly, positively determines the quality of formal institutions. The conducted analyses indicate that modern economies are diversified in terms of the quality of informal and formal institutions and, consequently, in institutional equilibrium. Considerable institutional disparities also translate into a large diversification in economic development. The article proposes a different meaning of institutional equilibrium, understood as the achieved state of institutional structure characterised by high quality informal institutions which interact with each other to improve the efficiency of formal institutions. The article presents a comprehensive model of the institutional structure and a unique method of measuring institutional equilibrium.

Keywords: institutional equilibrium; SEM-PLS; economic growth and development (search for similar items in EconPapers)
Date: 2022
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.2478/stattrans-2022-0019 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:vrs:stintr:v:23:y:2022:i:2:p:107-127:n:14

DOI: 10.2478/stattrans-2022-0019

Access Statistics for this article

Statistics in Transition New Series is currently edited by Włodzimierz Okrasa

More articles in Statistics in Transition New Series from Statistics Poland
Bibliographic data for series maintained by Peter Golla ().

 
Page updated 2025-03-20
Handle: RePEc:vrs:stintr:v:23:y:2022:i:2:p:107-127:n:14