The effect of trade and political institutions on economic institutions

Research output: Contribution to journalArticlepeer-review

12 Citations (Scopus)

Abstract

This study examines the relationship between trade and the quality of economic institutions under different political institutions. It uses panel data of 138 countries from 1984 to 2010 and employs instrumental variables and identification through heteroscedasticity to mitigate the problem of endogeneity. The findings suggest that the effect of trade on economic institutions reduces significantly in the presence of extractive political institutions. The findings indicate that ‘trade’ is not a sufficient tool for improving economic institutions; rather, trade policies need to be embedded in distinct political institutions to trigger the substantive improvement of economic institutions.

Original languageEnglish
Pages (from-to)89-110
Number of pages22
JournalJournal of International Trade and Economic Development
Volume26
Issue number1
DOIs
Publication statusPublished - Jan 2 2017
Externally publishedYes

Keywords

  • economic institutions
  • institutional change
  • political institutions
  • Trade

ASJC Scopus subject areas

  • Geography, Planning and Development
  • Development
  • Aerospace Engineering

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