Do Business-Friendly Reforms Boost GDP?

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Title: Do Business-Friendly Reforms Boost GDP?
Authors: Adhikari, TamannaWhelan, Karl
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Date: Dec-2019
Online since: 2020-02-11T12:05:31Z
Abstract: We use the time series variation in the World Bank’s “distance to frontier” estimates of the ease of doing business to assess the effects of changes in this variable on real GDP per capita. The use of Vector Autoregression techniques allows us to identify shocks to the ease of doing business that are initially uncorrelated with GDP, thus addressing an important endogeneity problem that affects the cross-sectional literature on this topic. The results are surprising. We report a robust finding that improvements to the ease of doing business have at least a temporary negative impact on GDP and find little evidence for a positive effect in the years following these improvements.
Type of material: Working Paper
Publisher: University College Dublin. School of Economics
Start page: 1
End page: 37
Series/Report no.: UCD Centre for Economic Research Working Paper Series; WP2019/30
Copyright (published version): 2019 the Authors
Keywords: Economic growthBusiness environmentDoing business
Language: en
Status of Item: Not peer reviewed
Appears in Collections:Economics Working Papers & Policy Papers

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