A business case for democracy: regime type, growth, and growth volatility

Knutsen, Carl Henrik

doi:10.1080/13510347.2021.1940965

Cited by 19 publications

(8 citation statements)

References 57 publications

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“…These findings could help to explain why long-term growth rates vary more across autocracies than across democracies; they also suggest that democratic countries are more resilient. Our results are thereby consistent with the recent work of Knutsen (2021). Using different statistical methods, he argues that democracy provides a safety net, ruling out the worst outcomes.…”

Section: Discussionsupporting

confidence: 91%

Political Institutions and Output Collapses

Imam¹,

Temple²

2023

IMF Working Papers

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Section: Discussionsupporting

confidence: 91%

Political Institutions and Output Collapses

Imam¹,

Temple²

2023

IMF Working Papers

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“…This result is consistent with the findings of Acemoglu et al (2019) and the recent study by Farè et al (2023). These authors provided evidence that democracy has a positive impact on economic activities and that a democratised society encourages choices in business venturing and contributes to improvement in entrepreneurial behaviour (Knutsen, 2021). However, the recent study by Okada and Samreth (2023) revealed that the significant impact of democracy is sector-specific.…”

Section: Resultsmentioning

confidence: 99%

Institutions and Entrepreneurship in Africa: Does Democracy Matter?

Ajide

2023

The Journal of Entrepreneurship

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Previous studies on the relationship between institutions and entrepreneurship do not cover the relevance of democracy in strengthening the two variables. It is not clear whether democratic regimes promote entrepreneurship in Africa. This study contributes to the debate by examining the impact of democracy on entrepreneurship in Africa. It also provides fresh insights by analysing how democracy can strengthen the relationship between institutional quality and entrepreneurship. Panel data from 23 African nations over the period 2006–2018 is used for the study. The results based on the panel-spatial correlation consistent technique augmented with least square dummy variables (PSCC-LSDV) show that a democratic regime is more favourable for promoting entrepreneurship. Findings reveal that good institutions promote entrepreneurship, and democratic regimes strengthen the relationship. It is also found that democracy and institutional quality perform complementary roles in promoting entrepreneurship in Africa. The findings suggest that an African nation with a truly democratic system of government can encourage entrepreneurial activities within its economy by using the opportunity presented by democracy to strengthen its institutional quality.

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“…An empirical study performed by D. Acemoglu and his co-authors (2019) proves that over the past 25 years, democratization has increased GDP per capita by 20% [13]. According to K. Knutsen (2020), democratic regimes provide stable and predictable growth, as evidenced by the fact that only 7% of democracies experienced negative growth between 1900 and 2009 compared to almost 30% of autocracies [33]. These democratic gains are primarily driven by vertical accountability mechanisms created by fair elections and freedom of expression [32].…”

Section: "Democracy Promotes Economic Growth" Positionmentioning

confidence: 99%

“…This socio-economic proximity made it possible to overcome the negative consequences of counterproductive state policy. Fidrmuc (2003;2021;2000) demonstrates that the link between democracy and economic growth is not so unambiguous and depends (in addition to structural and historical parameters) of the selected time interval. In the author's point of view, the relationship between democratization and growth can be depicted as a U-shaped curve (which contradicts the Barro's (1996) conclusions who notes that the relationship follows an inverted U-shaped curve).…”

Section: Le Link Between Democracy and Economic Growth In Transition ...mentioning

confidence: 99%

Democracy and Economic Growth:the Case of Moldova

Pavliuc¹,

Buga²

2022

JSS

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This article addresses the issue of the cause-and-effect relationship between democracy and economic growth in Moldova from 1990 to 2020. This problem is one of the key topics of modern economic political science, but the results concerning the influence of the political system on economy are still ambiguous. No research has been conducted to date on this issue for Moldova. The econometric analysis was conducted using tree composite indexes of democracy, published by Freedom house, Polity V and V-Dem Varieties of Democracy. The causal impact between democracy indexes and per capita GDP growth is tested using Granger causality analysis. The results show that the choice of the democracy indicator and the time interval influences the modeling outcome. All three democracy indices depict different democratic trends at the country level. Although there is a positive causal link between the Polity index and GDP per capita in a short period, other results show no evidence that democratic reforms did contribute to economic growth in Moldova and vice versa. We conclude that democratization in conditions of weak law and political instability contributed to the emergency of a so-called hybrid democracy in Moldova.

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A business case for democracy: regime type, growth, and growth volatility

Cited by 19 publications

References 57 publications

Political Institutions and Output Collapses

Political Institutions and Output Collapses

Institutions and Entrepreneurship in Africa: Does Democracy Matter?

Democracy and Economic Growth:the Case of Moldova

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