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Alternative instruments for institutional quality and the effect of european settlements on economic development
Author(s)
Date Issued
2004-06
Date Available
2009-07-24T15:32:33Z
Abstract
The study of the effect of institutional quality on economic performance has a long tradition in economic development. Considering the problems of reverse causality in the link between economic
development and institutions, most recent research employs instrumental variables for the measurement of this effect. The present
paper explores the impact of European settlements on economic development. These settlements are explained as a function of climate, disease environment, and availability of land. Here these variables are found to determine to a great extent European settlements in Africa and the Americas. Consequently, these variables are used as instruments for institutional quality and the large effect of institutions on income per capita documented by previous studies is through them confirmed. This
study finds evidence that limitations of other instruments are overcome using these variables as instruments.
Type of Material
Working Paper
Publisher
University College Dublin. School of Economics
Series
UCD Centre for Economic Research Working Paper Series
WP04/19
Subject – LCSH
Economic development
Institutional economics
Land settlement patterns
Colonies--Economic conditions
Language
English
Status of Item
Not peer reviewed
This item is made available under a Creative Commons License
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