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Democracy and economic growth: the role of intelligence in cross-country regressions

Raufhon Salahodjaev

MPRA Paper from University Library of Munich, Germany

Abstract: Empirical literature has long conjectured that institutional arrangements, proxied by democracy, social capital and intelligence, are relevant determinants in cross-country differences in economic performance. Related literature, however, predominantly documents that democracy has either a negative or not significant impact on economic growth, while intelligence is assumed to have strong and direct effect on economic performance. We propose that that the effect of democratization is mediated by the degree of the approval to such policies, and that intelligence may alleviate or diminish the negative effect of weak institutions on economic growth. We empirically, investigate the interactive effect of democracy and intelligence on economic growth, using data from 93 nations, over the period 1970-2013. The results show that the relationship link between democracy and the real GDP growth varies with a nation’s level of cognitive abilities. The results remain robust to various estimation techniques, control variables and time periods.

Keywords: intelligence; democracy; economic growth; IQ; cross-county (search for similar items in EconPapers)
JEL-codes: I25 O43 O47 (search for similar items in EconPapers)
Date: 2015-02-23, Revised 2015-04-26
New Economics Papers: this item is included in nep-gro and nep-neu
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (26)

Published in Intelligence 50 (2015): pp. 228-234

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