From Riches to Rags, and Back? Institutional Change, Financial Development and Economic Growth in Argentina since the 1890s

Nauro Campos, Menelaos G. Karanasos () and Bin Tan
Additional contact information
Menelaos G. Karanasos: Brunel University
Bin Tan: Southwest Jiaotong University

No 8654, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Argentina is the only country in the world that was "developed" in 1900 and "developing" in 2000. The various competing explanations highlight, mainly, the roles of trade openness, political institutions, financial integration, financial development, and macroeconomic instability. Yet no study has, to the best of our knowledge, attempted a quantitative assessment of the relative importance of each of these competing explanations. This paper tries to fill this gap. It investigates their individual effects on economic growth and volatility using the power-ARCH framework with annual data since the 1890s. The results indicate that financial development and institutional change are the two main factors that help understand the extraordinary growth trajectory of Argentina over the last century.

Keywords: institutions; volatility; financial development; economic growth; political instability; power-GARCH (search for similar items in EconPapers)
JEL-codes: C14 D72 E23 O40 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2014-11
New Economics Papers: this item is included in nep-gro and nep-his
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Published - published in: Journal of Development Studies, 2016, 52(2), 206 - 223

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Journal Article: From Riches to Rags, and Back? Institutional Change, Financial Development and Economic Growth in Argentina since 1890 (2016)
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