How important are Institutions for Growth in Transition Countries?

Luc Moers

No 99-004/2, Tinbergen Institute Discussion Papers from Tinbergen Institute

Abstract: Growth empirics with institutional measures is performed for 25 transition countries overthe period 1990-95. Estimation results suggest that (particularly state) institutions aresignificant for growth and, especially, foreign direct investment (FDI), the latter in turnbeing important for the former. It is also found that the correlation between institutionsand FDI is more likely to be a (direct) causation. Only inflation and war seem to have beenrelatively more important for growth performance in transition countries than institutionsper se. This suggests that macroeconomic stabilization and peace should be the main policypriorities in transition, closely followed by institution building.

Keywords: Transition economics; growth empirics; institutions; policy reform (search for similar items in EconPapers)
JEL-codes: O17 O57 P21 P24 P27 P51 (search for similar items in EconPapers)
Date: 1999-02-12
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Citations: View citations in EconPapers (16)

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Journal Article: Growth empirics with institutional measures for transition countries (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:tin:wpaper:19990004

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