Local institutional quality and economic growth: a panel-VAR analysis of Italian NUTS-3 regions

Corradini, C. (2021) Local institutional quality and economic growth: a panel-VAR analysis of Italian NUTS-3 regions. Economics Letters, 198. 109659. ISSN 0165-1765 doi: 10.1016/j.econlet.2020.109659

Abstract/Summary

We explore the relationship between institutional quality and economic growth across a panel of Italian NUTS-3 regions. Estimates from panel vector autoregressions provide robust evidence in support of a causal effect of institutional quality on growth. This is found to be particularly important in areas characterised by lower levels of economic development. Conversely, no evidence is found of reverse dynamics of economic growth on institutional quality. The results cast doubts on the view that policies focusing on economic growth per se may lead to a strong institutional context, suggesting intervention aimed at improving formal institutions to be a pre-requisite for sustained regional development.

Item Type	Article
URI	https://reading-clone.eprints-hosting.org/id/eprint/111526
Identification Number/DOI	10.1016/j.econlet.2020.109659
Refereed	Yes
Divisions	No Reading authors. Back catalogue items
Publisher	Elsevier BV
Download/View statistics	View download statistics for this item