Publication Type
Journal Article
Version
submittedVersion
Publication Date
1-2023
Abstract
Is democracy a better political regime for economic prosperity than autocracy? This paper shows that the answer depends on the initial economic development level during the democratic transition when the foundation of institutions was laid. Democracy facilitates growth only in countries that already have adequate development at transition time. These countries are more likely to create and sustain growth-enhancing institutions than others. Without appropriate development, democracy does not improve growth; this applies to about 40% of the third-wave democratized countries. These results are based on a sample of 153 countries in 1960–2010 and robust to various specifications and endogeneity issues.
Keywords
Democracy, Growth, Economic Development, Institutions, Critical Juncture, Democratization, Modernization, Human Capital
Discipline
Growth and Development | Political Economy
Research Areas
Applied Microeconomics
Publication
European Journal of Political Economy
First Page
1
Last Page
20
ISSN
0176-2680
Identifier
10.1016/j.ejpoleco.2022.102355
Publisher
Elsevier: 24 months
Citation
SIMA, Di and HUANG, Fali.
Is democracy good for growth? Development at political transition time matters. (2023). European Journal of Political Economy. 1-20.
Available at: https://ink.library.smu.edu.sg/soe_research/2664
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1016/j.ejpoleco.2022.102355