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Democracy and Growth: Evidence of a New Measurement

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  • Klaus Gründler
  • Tommy Krieger

Abstract

We present a novel approach for measuring democracy based on Support Vector Machines, a mathematical algorithm for pattern recognition. The Support Vector Machines Democracy Index (SVMDI) is continuously on the 0-1-interval and enables a very detailed measurement of democracy for 188 countries between 1981 and 2011. Application of the SVMDI highlights a robust positive relationship between democracy and economic growth. We argue that the ambiguity in recent studies mainly originates from the lack of sensitivity of traditional democracy indicators. Analyzing transmission channels we conclude that democratic countries have better educated populations, higher investment shares, and lower fertility rates, but not necessarily higher levels of redistribution.

Suggested Citation

  • Klaus Gründler & Tommy Krieger, 2015. "Democracy and Growth: Evidence of a New Measurement," CESifo Working Paper Series 5647, CESifo.
    • Handle: RePEc:ces:ceswps:_5647
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    References listed on IDEAS

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    Cited by:

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    2. Nguenda Anya, Saturnin Bertrand & Nzepang, Fabrice, 2022. "The role of the separation of democratic powers on structural transformation in Sub-Saharan Africa," Economic Systems, Elsevier, vol. 46(4).

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    More about this item

    Keywords

    democracy; economic growth; democracy index; support vector machines;
    All these keywords.

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • F50 - International Economics - - International Relations, National Security, and International Political Economy - - - General
    • F55 - International Economics - - International Relations, National Security, and International Political Economy - - - International Institutional Arrangements
    • H00 - Public Economics - - General - - - General
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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