Political instability and economic growth: an empirical evidence from the Baltic states
For more than last 20 decades, new political economics has been dealing with theories of economic growth (for example influential contributions by Mancur Olson, Dani Rodrik). However, less attention has been paid to their empirical verification. The new political economics growth theory defines some...
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| Format: | Article |
| Language: | English |
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Mendel University Press
2011-01-01
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| Series: | Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis |
| Subjects: | |
| Online Access: | https://acta.mendelu.cz/59/2/0081/ |
| _version_ | 1828844410170769408 |
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| author | Ladislava Grochová Luděk Kouba |
| author_facet | Ladislava Grochová Luděk Kouba |
| author_sort | Ladislava Grochová |
| collection | DOAJ |
| description | For more than last 20 decades, new political economics has been dealing with theories of economic growth (for example influential contributions by Mancur Olson, Dani Rodrik). However, less attention has been paid to their empirical verification. The new political economics growth theory defines some factors that are necessary for economic growth among which political stability. Our aim is to test the theory focused on political stability empirically in order to enrich the studies with recent European results. The paper uses a single-equation model to reject a hypothesis that political stability is a necessary condition for economic growth finding a relationship between economic growth and political instability. A demonstration that political stability is not a crucial factor for economic development in general then represents the main goal of the contribution. There are distinguished two types of political instability – elite and non-elite – in topical literature. While non-elite political instability concerns about violent coups, riots or civil wars, elite political instability is represented with “soft changes” such as government breakdowns, fragile majority or minority governments. A number of government changes is used as a proxy of elite political instability. The disproof of the hypothesis is demonstrated on data from the Baltic states where number of government changes takes place and still fast economic growth could be seen within last two decades. Since it is shown that political instability has almost no impact on economic growth, we consider the hypothesis regarding a necessity of political stability for economic development to be only a specific non-generalizable case. |
| first_indexed | 2024-12-12T21:04:50Z |
| format | Article |
| id | doaj.art-6b0cd879f038408c90c798d141008a61 |
| institution | Directory Open Access Journal |
| issn | 1211-8516 2464-8310 |
| language | English |
| last_indexed | 2024-12-12T21:04:50Z |
| publishDate | 2011-01-01 |
| publisher | Mendel University Press |
| record_format | Article |
| series | Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis |
| spelling | doaj.art-6b0cd879f038408c90c798d141008a612022-12-22T00:12:02ZengMendel University PressActa Universitatis Agriculturae et Silviculturae Mendelianae Brunensis1211-85162464-83102011-01-01592818810.11118/actaun201159020081Political instability and economic growth: an empirical evidence from the Baltic statesLadislava Grochová0Luděk Kouba1Ústav ekonomie, Mendelova univerzita v Brně, Zemědělská 1, 613 00 Brno, Česká republikaÚstav ekonomie, Mendelova univerzita v Brně, Zemědělská 1, 613 00 Brno, Česká republikaFor more than last 20 decades, new political economics has been dealing with theories of economic growth (for example influential contributions by Mancur Olson, Dani Rodrik). However, less attention has been paid to their empirical verification. The new political economics growth theory defines some factors that are necessary for economic growth among which political stability. Our aim is to test the theory focused on political stability empirically in order to enrich the studies with recent European results. The paper uses a single-equation model to reject a hypothesis that political stability is a necessary condition for economic growth finding a relationship between economic growth and political instability. A demonstration that political stability is not a crucial factor for economic development in general then represents the main goal of the contribution. There are distinguished two types of political instability – elite and non-elite – in topical literature. While non-elite political instability concerns about violent coups, riots or civil wars, elite political instability is represented with “soft changes” such as government breakdowns, fragile majority or minority governments. A number of government changes is used as a proxy of elite political instability. The disproof of the hypothesis is demonstrated on data from the Baltic states where number of government changes takes place and still fast economic growth could be seen within last two decades. Since it is shown that political instability has almost no impact on economic growth, we consider the hypothesis regarding a necessity of political stability for economic development to be only a specific non-generalizable case.https://acta.mendelu.cz/59/2/0081/new political economicspolitical instabilityelite political instabilityproduction functionsingle equationBaltic states |
| spellingShingle | Ladislava Grochová Luděk Kouba Political instability and economic growth: an empirical evidence from the Baltic states Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis new political economics political instability elite political instability production function single equation Baltic states |
| title | Political instability and economic growth: an empirical evidence from the Baltic states |
| title_full | Political instability and economic growth: an empirical evidence from the Baltic states |
| title_fullStr | Political instability and economic growth: an empirical evidence from the Baltic states |
| title_full_unstemmed | Political instability and economic growth: an empirical evidence from the Baltic states |
| title_short | Political instability and economic growth: an empirical evidence from the Baltic states |
| title_sort | political instability and economic growth an empirical evidence from the baltic states |
| topic | new political economics political instability elite political instability production function single equation Baltic states |
| url | https://acta.mendelu.cz/59/2/0081/ |
| work_keys_str_mv | AT ladislavagrochova politicalinstabilityandeconomicgrowthanempiricalevidencefromthebalticstates AT ludekkouba politicalinstabilityandeconomicgrowthanempiricalevidencefromthebalticstates |