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Searching for Growth-conducive Institutions in Emerging Economies: A Stochastic Frontier Analysis

Author

Listed:
  • Woon Kan Yap
  • Jenny Gryzelius
  • Andrew Tek Wei Saw

Abstract

This study aims to identify growth-conducive institutions unique to emerging economies. For that purpose, we examine the roles of Anglo-American institutions in fostering total factor productivity growth through the improvement of technical efficiency in emerging economies. Specifically, the impacts of the liberalistic and paternalistic types of regulatory institutions are discerned. The results show that institutional qualities such as reverence for the rule of law and effective governments robustly promote total factor productivity by improving technical efficiency, while voices of citizens and political stability exhibit a symbiotic relationship, where the efficacy of one of these qualities requires the sufficient prevalence of another. Regarding regulatory institutions, we found evidence that calls for protectionist policies to foster innovation, which is the key driver of technical efficiency.

Suggested Citation

  • Woon Kan Yap & Jenny Gryzelius & Andrew Tek Wei Saw, 2023. "Searching for Growth-conducive Institutions in Emerging Economies: A Stochastic Frontier Analysis," Politická ekonomie, Prague University of Economics and Business, vol. 2023(5), pages 591-618.
    • Handle: RePEc:prg:jnlpol:v:2023:y:2023:i:5:id:1398:p:591-618
    DOI: 10.18267/j.polek.1398
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    References listed on IDEAS

    as
    1. Nishimizu, Mieko & Page, John M, Jr, 1982. "Total Factor Productivity Growth, Technological Progress and Technical Efficiency Change: Dimensions of Productivity Change in Yugoslavia, 1965-78," Economic Journal, Royal Economic Society, vol. 92(368), pages 920-936, December.
    2. Aigner, Dennis & Lovell, C. A. Knox & Schmidt, Peter, 1977. "Formulation and estimation of stochastic frontier production function models," Journal of Econometrics, Elsevier, vol. 6(1), pages 21-37, July.
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    More about this item

    Keywords

    Institutional quality; total factor productivity; technical efficiency; stochastic frontier analysis; strategic niche management;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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