Rent Seeking Opportunities and Economic Growth in Transitional Economies

No 2013:87, PIDE-Working Papers from Pakistan Institute of Development Economics

Abstract: This study empirically explores the growth effects of rent seeking activity (RSA) for a group of 52 developing/transitional countries, using a dynamic panel data approach. The modelling framework is a Mankiw-Romer-Weil (MRW) conditional convergence model augmented by measures of the opportunities for RSA, namely indices for the extent of democracy and corruption control. We find that health is more relevant than educational participation as a measure of human capital development in the MRW model. The overall empirical analysis shows that RSA retards economic growth, in that democratic institutions, which are inimical to RSA, are growth enhancing. We also find that reduction in the extent of corruption is only growth-enhancing if supported by well-developed democratic institutions.

Keywords: Rent-seeking; Economic Growth; Panel Data (search for similar items in EconPapers)
JEL-codes: E13 O43 O47 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2013
New Economics Papers: this item is included in nep-fdg and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Rent seeking opportunities and economic growth in transitional economies (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:pid:wpaper:2013:87

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