Deregulation, Economic Growth and Growth Acceleration

Petar Stankov

CERGE-EI Working Papers from The Center for Economic Research and Graduate Education - Economics Institute, Prague

Abstract: The paper analyzes the influence of credit-, labor-, and product market deregulation policies on economic growth in more than 70 economies over a period of 30 years. It addresses both the issues of reform measurement and its endogeneity. Specifically, by combining a difference-in-difference strategy with an IV approach to the endogeneity of the reform timing, this work finds that deregulation contributed to the per capita GDP levels of the early reformers relatively more than to the ones of the late reformers. However, the paper also finds that accelerating credit market reforms leads to a large growth acceleration effect for the late reformers, which points to large dynamic welfare gains from deregulation. The latter result suggests that a large-scale credit market re-regulation in the aftermath of the Great Recession is a misguided approach to deal with the consequences of the financial crisis.

Keywords: deregulation; economic growth; origins of institutional change (search for similar items in EconPapers)
JEL-codes: K20 N43 (search for similar items in EconPapers)
Date: 2010-10
New Economics Papers: this item is included in nep-fdg and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Deregulation, Economic Growth and Growth Acceleration (2018)
Working Paper: Deregulation, economic growth and growth acceleration (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:cer:papers:wp424

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