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Published February 11, 2021 | Version v1
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Considering institutional type: a varieties of capitalism approach to the economic growth resource curse

Authors/Creators

  • 1. ;*

Description

Defined by North (1994) as the "rules of the game", over the last few decades, many scholars have sought to understand whether quality institutions can alleviate the Resource Curse (the idea that natural resource abundance hinders rather than promotes economic growth). However, with this focus on quality, few papers have addressed the question of institutional type, and its Curse mitigating properties. This paper, via utilising the associated data, contributes towards filling this gap. Using the Varieties of Capitalism framework, we test whether certain institutional typologies possess the ability to mitigate the Resource Curse and perhaps even turn it into a blessing. Specifically, Rougier and Combarnous' cluster analysis, "The Diversity of Emerging Capitalisms in Developing Countries" (2017), whereby nations are assigned various institutional typologies is used to create our primary (dummy) independent variables of interest in this study. The remaining control variables essential for economic growth analysis are collected via the World Bank and Polity datasets.

Notes

To replicate this dataset, interested parties will need access to the following sources of data:

1) The World Bank

2) Polity IV

3) Rougier, E. and Combarnous, F., 2017. The Diversity of Emerging Captialism in Developing Countries: Globalization, Institutional Convergence and Experimentation. Cham: Palgrave Macmillan (p. 111).

4) La Porta, R., Lopez-de-Silanes, F., Shleifer, A. and Vishny, R., 1999. The Quality of Government. Journal of Law, Economics and Organization, 15(1), pp. 222-279 (pp. 268-276 specifically).

Additionally, it is noteworthy that in calculating averages, missing data was resolved via a method of average imputation whereby said missing data was replaced by the period average.

To reanalyse the data, one can take the following steps:

  1. Create interaction terms between institutional typology variables and the Resource Abundance variable as well as interaction terms between institutional quality variables and the Resource Abundance variable. The latter of these acts as a control variable.
    1. This is essential to test this paper's hypothesis that it is institutional typology's interaction with resource abundance that impacts economic growth.
  2. Using the other control variables outlined in the above "Methods" section, create OLS multiple linear regression models of the following form:
    1. Yi = β0+ β1Qi +β2Wi + β3Xi +β4Zi +εI
    2. Here, Yi is our dependent variable, Growth, Qi is a vector of our included institutional type variables, Wi is a vector of our included institutional type variables' interaction with Resource Abundance, Xi is Resource Abundance, and Zi is a vector of our included controls.
    3. Researchers can vary the omitted institutional typology variable depending on differing institutional type comparison desires.
  3. To test the robustness of results, add to the regression, both individually and collectively, the variables outlined above in the "Methods" section intended for such purpose, paying attention to whether the independent variables of interest change sign, magnitude or statistical significance.

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Is source of
10.5061/dryad.8931zcrp9 (DOI)