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Trade liberalization and institutional development
journal contribution
posted on 2023-06-08, 11:23 authored by Sambit BhattacharyyaSambit BhattacharyyaRecent research shows that the majority of cross-national variation in institutions is related to history. The within variation however is somewhat less explored. Using panel data covering the periods 1865 – 1940 and 1980 – 2000 & 31 and 103 countries respectively, we find that the within variation in economic institutions (namely property rights and contracts) can be explained by trade liberalization. To address endogeneity concern we use export partner growth and rainfall as instruments for trade liberalization and log GDP per capita respectively and estimate our model using Limited Information Maximum Likelihood (LIML) Fuller estimation method. Our basic result holds after controlling for country fixed effects, time varying common shocks, and various additional covariates. It is also robust to various alternative measures of liberalization and institutions, as well as across different samples.
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Publication status
- Published
Journal
Journal of Policy ModelingISSN
0161-8938Publisher
ElsevierExternal DOI
Issue
2Volume
34Page range
253-269Department affiliated with
- Economics Publications
Full text available
- No
Peer reviewed?
- Yes
Legacy Posted Date
2012-05-02Usage metrics
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