NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Empirical Linkages Between Democracy and Economic Growth

John F. Helliwell

NBER Working Paper No. 4066 (Also Reprint No. r1890)
Issued in June 1994
NBER Program(s):   ITI   EFG

Using cross-sectional and pooled data for up to 125 countries over the period from 1960 to 1985, this paper evaluates the two-way linkages between democracy and economic growth. The effects of income on democracy are found to be robust and positive. The effects of several measures of democracy on growth are assessed in a comparative growth framework in which growth of per capita GDP depends negatively on initial income levels, as implied by the convergence hypothesis, and positively on rates of investment in physical and human capital. Adjusting for the simultaneous determination of income and democracy makes the estimated direct effect of democracy on subsequent economic growth negative but insignificant. Allowing for the possible positive indirect effect of democracy on income, flowing through the positive effect of democracy on education and investment, tends to offset the negative direct effect of democracy on economic growth. The general result of the growth analysis is that it is still not possible to identify any systematic net effects of democracy on subsequent economic growth.

download in pdf format
   (2056 K)

email paper

This paper is available as PDF (2056 K) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Published: British Journal of Political Science, vol. 24, pp. 225-248, April 1994

Users who downloaded this paper also downloaded these:
Barro w5698 Determinants of Economic Growth: A Cross-Country Empirical Study
Barro w4909 Democracy & Growth
Persson and Tabellini w13150 The Growth Effect of Democracy: Is It Heterogenous and How Can It Be Estimated?
Alesina, Ozler, Roubini, and Swagel w4173 Political Instability and Economic Growth
Aghion, Alesina, and Trebbi w13180 Democracy, Technology, and Growth
 
Publications
Activities
Meetings
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us