This paper compares more direct measures of the institutional environment with both the instability proxies used by Barro (1991) and the Gastil indices, by comparing their effects both on growth and private investment. The results provide substantial support for the position that the...

Douglass North (1990) describes institutions as the rules of the game that set limits on human behavior, now a universally-accepted definition. North and others especially underline the crucial role of informal social norms. They predict that, like all rules of the game, social norms should...

We reconstruct a dataset used by Persson and Tabellini (AER, 1994) to test the robustness of their finding that inequality reduces income growth, but only in democracies. We find that their result is highly sensitive to the use of data sources on both democracy and inequality. When we substitute...

This paper makes two contributions to the literature. First, it introduces a new, easily accessed and objective measure of the enforceability of contracts and the security of property rights. Second, it uses this measure to provide additional and more direct evidence about the importance of...

We present and test empirically a new theory of property and contract rights. Any incentive an autocrat has to respect such rights comes from his interest in future tax collections and national income and increases with his planning horizon. We find a compelling empirical relationship between...

Aid potentially can contribute to democratization in several ways: (1) through technical assistance focusing on electoral processes, the strengthening of legislatures and judiciaries as checks on executive power, and the promotion of civil society organizations, including a free press; (2)...

This county-level study examines factors associated with the rate of voided presidential ballots in the 1996 elections. Evidence indicates that voided ballots are significantly more prevalent in counties with higher percentages of African Americans and Hispanics. The relationship between voided...

This chapter surveys the major contributions to the rapidly growing empirical literature on social capital and economic performance, focusing primarily on cross-country approaches. It first addresses characteristics of governments that fall under broad definitions of the term social capital. It...

Empowerment of the poor does not necessarily make them better off – or make the non-poor worse off. In some cases, empowerment may be inefficient, i.e. a negative-sum game. In other cases, it is a zero-sum game, as the poor can benefit only at the expense of someone else. But in many cases, it...

Assuming that J. S. Mill and others are correct in their belief that trust matters for the economic performance of nations, the determinants of trust become important. Section 2 discusses the sources of trust and briefly summarizes empirical evidence. Section 3 builds on Fukuyama’s concept of...