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Does Governance Cause Growth? Evidence from China

Wilson, Ross LU (2015) In Working Paper / Department of Economics, School of Economics and Management, Lund University
Abstract
This study uses heterogeneous panel Granger causality tests to investigate the causal relationships between quality of governance and economic growth at the provincial level in China during the reform era. I find a significant and positive effect of economic growth on subsequent quality of governance, largely driven by growth in the secondary sector, but no significant effect of quality of governance on economic growth. These findings suggest that improvements in formal governance have not been a key factor in China’s rapid growth, and support the proposition that governance reforms are often a consequence, rather than a cause, of economic growth.
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author
organization
publishing date
type
Working Paper
publication status
published
subject
keywords
Asia, China, Quality of Governance, Economic Growth
in
Working Paper / Department of Economics, School of Economics and Management, Lund University
issue
14
pages
40 pages
publisher
Department of Economics, Lund Universtiy
language
English
LU publication?
yes
id
6cd9b811-426c-47ec-8f2c-d939f7572f2e (old id 5365366)
alternative location
http://swopec.hhs.se/lunewp/abs/lunewp2015_014.htm
date added to LUP
2015-05-05 10:09:51
date last changed
2016-08-30 10:26:51
@misc{6cd9b811-426c-47ec-8f2c-d939f7572f2e,
  abstract     = {This study uses heterogeneous panel Granger causality tests to investigate the causal relationships between quality of governance and economic growth at the provincial level in China during the reform era. I find a significant and positive effect of economic growth on subsequent quality of governance, largely driven by growth in the secondary sector, but no significant effect of quality of governance on economic growth. These findings suggest that improvements in formal governance have not been a key factor in China’s rapid growth, and support the proposition that governance reforms are often a consequence, rather than a cause, of economic growth.},
  author       = {Wilson, Ross},
  keyword      = {Asia,China,Quality of Governance,Economic Growth},
  language     = {eng},
  number       = {14},
  pages        = {40},
  publisher    = {ARRAY(0x8ae9f30)},
  series       = {Working Paper / Department of Economics, School of Economics and Management, Lund University},
  title        = {Does Governance Cause Growth? Evidence from China},
  year         = {2015},
}