We present a simple model that illustrates how democracy may improve the quality of economic institutions. The model further suggests that institutional quality varies more across autocracies than across democracy and that the positive effect of democracy on institutional quality is increasing...

Using detailed establishment-level micro data, this paper analyzes the quantitative implications of the missing-growth hypothesis by Aghion, Bergeaud, Boppart, Klenow, and Li (2019) for Germany. This hypothesis states that actual growth rates of real output are systematically understated by...