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This paper examines the relationship between regulation-induced time delays and export entrepreneurship in a panel of 59 countries for the period 2006 to 2014. The paper finds robust evidence that regulations which cause lengthy time delays in moving a standard container of goods from the factory to the seaport significantly reduce export entry rate. These findings support the hypothesis that decreasing regulation-induced time delays expands export entrepreneurship by reducing the cost of exporting. Additionally, the paper finds that superior quality institutions significantly enhance the positive impact of lower regulatory time barriers on export entrepreneurship. Stronger protection of private property rights is the most important measure of institutional quality that aides the favorable impact of lower regulation-induced time barriers on export entrepreneurship. Furthermore, a reduction in regulation-induced time barriers has a positive effect on net entry rate and survival rates of export entrants, and high-quality institutions significantly increase the magnitude of this positive outcome.

Institutional quality in the form of extractive or inclusive institutions influences economic outcomes. We examine the positive moderating effect of institutional quality on the relationship between financial inclusion and poverty alleviation over a sample of seventy-five developing and developed countries (2004–2017). We use six different financial inclusion measures together with an informal political institution variable, applying both cross-section and quantile analysis. We find that institutional quality intensifies the beneficial effects of financial inclusion on poverty rates. This effect is more pronounced in poorer economies than in wealthier ones. Our findings yield implications for policy makers seeking to tackle the institutional causes of poverty.

Our paper is the first attempt to examine the non-linear effects of economic complexity on the shadow economy. By applying diverse econometric techniques to a global sample of 42 low-income & lower-middle-income (LI&LMICs) and 30 upper-middle-income (UMICs) and 38 high-income (HICs) during the 2002–2017 period, our findings confirm the presence of a non-linear association between economic complexity outlook index and the shadow economy while economic complexity index has an increasingly significant and negative influence on shadow economy. Furthermore, a non-linear relationship between economic complexity and the shadow economy more likely exists either in the long run or in the high-income economy. Notably, we find that economic complexity plays a critical role in deteriorating the positive effects of uncertainty on the size of the shadow economy, while institutional quality significantly determines the effect of economic complexity.

This study explores the impacts of migrants’ remittances and institutional quality on financial development in developing countries, and further tests the hypothesis that institutional quality influences the impact of remittances on financial development. Applying an unobserved dynamic factor model to 46 countries for the period of 1996 to 2016, a composite institutional quality index is first estimated that represents national institutional quality. Using fixed- and random-effects instrumental variable (IV) estimations, evidence is then provided that demonstrates that remittances and institutional quality promote financial development, and more importantly, that institutional quality can play a significant role in enhancing the impact of remittances on financial development, especially when institutional quality attains a certain high level. These results suggest that in countries with stronger institutions, remittances are transmitted more effectively and efficiently to promote financial development than in countries with weaker institutions. Moreover, in accordance with previous literature, financial openness and trade openness are shown to be critical for financial development.

Introduction We present our experience developing and embedding a registry-based module for resident feedback. Methods At our institution, entering operative data into the institutional quality collaborative registry is standard practice. In February 2019, a surgical education module was embedded into the registry to capture procedure-specific resident operative assessments. Faculty engagement with the sugical education module was assessed during its first year in existence (February 2019-February 2020). Results In total, 1074 of 1269 (85%) operative assessments were completed by 27 faculty via the surgical education registry module. Median faculty engagement rate with the module following resident-assisted procedures was 91% [IQR 76%-100%]. Residents received a median of 7 operative assessments [IQR 2-19] over the study period. Conclusion By embedding a surgical education module into an existing surgical quality collaborative registry, procedure-specific operative assessments can be routinely captured.

This paper provides evidence of the role that financial market development and institutional quality play in the integration of European Union (EU) life insurance markets. It analyzes ten EU life insurance markets over a seventeen-year sample period. The meta-technology cost/revenue efficiency ratios, estimated under the meta-frontier DEA framework, are used as a measure of integration and the analysis is conducted by applying Tobit panel regression models. We find that national stock market development and institutional quality enhance cost performance and integration of EU life insurance markets. Results also show that in countries where bancassurance is the main life insurance distribution channel, banking sector development contributes to integration in terms of revenue efficiency. However, we find that better outcomes in national institutional quality decrease the meta-technology revenue efficiency ratio, suggesting that life insurance prices are lower in countries with better institutions. Funding for open access charge: Universidad de Málaga / CBUA. The authors gratefully acknowledge financial support from the Spanish Ministry of Science, Innovation and Universities (Project RTI2018-097620-B-100) and Universidad de Málaga Campus de Excelencia Internacional Andalucía Tech. This paper was awarded the 2020 ‘‘Antonio Dionis Soler’’ Research Prize (accésit) by Fundación de Estudios Financieros

This paper examines the effect of terms-of-trade volatility on growth volatility. It also investigates whether financial development and institutional quality mitigate the negative effect of terms-of-trade volatility on growth volatility. The model is empirically tested for 45 African countries over the period 1997–2017. The empirical strategy is based on the generalized method of moments, and the following results are established. Strong evidence is provided to support that terms of trade volatility increases growth volatility in African countries. The results further indicate that institutional quality mitigates the negative effect of terms-of-trade volatility. When financial development is considered, we provide evidence that financial development is a shock absorber, with financial institutions having a stronger effect than financial markets. These results are robust to the use of alternative measures of growth volatility, terms of trade volatility, and different specifications.

This paper provides evidence regarding the impact of soft information on foreign bank efficiency in the ASEAN-5 market in the years following the Asian crisis. The analysis presented here develops previous literature by disaggregating soft information into five difference types and examining whether institutional quality (proxied for by host-country economic risk stability index) mitigates the impact. Using a three-stage estimation process we find that soft information does indeed affect foreign banks’ efficiencies in an identifiable manner, but host-country institutional quality acts so as to significantly lessen the effect.

We study the interactions between institutional quality, government expenditure, tax revenue, and economic growth in low-income countries (LICs) and lower middle-income countries (LMICs) over 2005–2019. The primary distinguishing factor of the paper is the simultaneous inclusion of all these four variables in a single temporal causal model. A second distinguishing feature of the paper is its focus on LICs and LMICs and a clear distinction between short-run and long-run results. Tax revenue is considered as general revenue as well as revenue from taxes on international trade, and customs and other import duties. Our results show that institutional quality, government expenditure, tax revenue, and economic growth often have endogenous links among each other in the short run. These results are not always uniform across our samples. On the other hand, a robust and uniform result across all samples is that the three covariates are important drivers of long-term economic growth. Thus, the co-development of stronger institutions and more effective fiscal policies (relating to taxes and government expenditure) appear to be key in procuring sustained long-term economic growth of countries.

This paper analyzes how institutions' quality shapes the relationship between inflation targeting and financial stability in 63 countries over the period 1990–2014. We find that targeters with poor institutions are less financially stable than non-targeters only in Emerging and Developing Countries who use little or no macroprudential policies. As these policies are implemented, this effect works in reverse or becomes nil when institutions' quality improves. Thus, our paper calls for an explicit mandate for central banks in former countries to pursue both inflation and financial stability through macroprudential instruments' moderate use.

What makes an asset institutional quality? This paper proposes that one reason is the existing concentration of delegated investors in a market through a liquidity channel. Consistent with this intuition, it documents differences in investor composition across US cities and shows that delegated investors concentrate their investments in cities with higher turnover. It then estimates a search model showing how heterogeneity in liquidity preferences makes some markets more liquid, even when assets have identical cash flows. The paper provides evidence for clientele equilibria arising in frictional asset markets and suggests that a liquidity channel may explain divergent paths in city development.

The increasingly severe environmental crisis has become one of the most important issues of international debate at present. The acceleration of environmental problems places considerable pressure on individuals, governments, and policymakers. Greenhouse gas emissions caused by fossil-based energy sources have made clean energy sources, such as renewable energy, a strategic choice. Although renewable energy is a key factor in mitigating environmental problems, analysis of its determinants has certain limitations. Despite studies that focus on macroeconomic and environmental determinants of renewable energy, political and institutional factors are neglected. Therefore, to fill the existing gap, the present study analyzes the connection between renewable energy and institutional quality in 38 countries during the period 1990–2015. Economic growth and CO2 emissions are included in the model as control variables. The findings of this study lead to the conclusion that the institutional quality positively affects renewable energy consumption in the long run. Furthermore, CO2 emission is a positive and important determinant of renewable energy consumption. However, economic growth negatively affects renewable energy. In this context, institutional quality is a key strategic choice in promoting the use of renewable energy and solving environmental problems.

This paper examines the effect of sectoral foreign aid and institutional quality on the economic growth of 74 developing countries from Africa, Asia and South America, and covers the period 1980-2016. We consider bilateral aid flows into three sectors, namely education, health and agriculture, and find that among the three types of aid, education aid is more effective for aid-receiving countries. The effect is conditional on the current level of institutional quality and varies substantially across regions. While education aid is more effective in South America, health aid is more effective in Asia and agricultural aid is more effective in Africa. As the level of institutional quality improves, the gap between the marginal effect of education, health and agricultural aids widen. Our findings have strong policy implication for donor countries and international aid organisations, which shows that it is more desirable to shift aid flows towards the education sector as the level of institutional quality improves. Refereed/Peer-reviewed

By analysing 796 companies' data from 21 European countries, this research uncovered the nexus between institutional quality (IQ) and corporate sustainable performance (CSP). The relationship was theoretically examined with the lens of institutional theory and then empirically tested. The findings show that IQ has a positive and significant impact in safeguarding CSP, and firms’ characteristics play an essential preamble in this regard. We additionally found the heterogeneous impact of IQ on CSP. To come to a conclusion, we have applied random effect, two-step system GMM and quantile regression models. Our findings are consistent and empirically robust; therefore, the study disseminates key messages to policymakers and practitioners about the role of IQ in safeguarding CSP. Validerad;2023;Nivå 2;2023-02-24 (hanlid)

Several studies have studied the determinants of energy efficiency. However, the influence of government institutions was mostly ignored as only few studies have provided evidence on the role of institutions in enhancing domestic energy efficiency. In this paper, we extend the previous literature by asking whether neighboring country's institutions could also have an impact on domestic energy efficiency. Thus, with the stochastic frontier approach and spatial econometric model, we investigate the spatial effect of institutional quality on energy efficiency in a panel of 99 countries (economies) for the period 1995–2016. Our results, first confirm the presence of spatial correlations in energy efficiency across countries. Secondly, we discover that the direct positive effect of institutional quality on energy efficiency is such that it overcomes the insignificant indirect negative effect, which suggests a total positive and significant effect. Our results, therefore, indicate that institutional quality matters in energy efficiency improvement and being close to countries with good institutional framework has a positive effect on domestic energy efficiency. Finally, the energy efficiency estimates demonstrate that global energy issue can only be addressed with long-term policies that increases technological progress.

We analyze the impact of institutional quality on firm survival in 15 European emerging markets. We employ the Cox proportional hazards model with a large dataset of firms during 2006–2015. Our results show that institutional quality (IQ) is a significant preventive factor for firm survival, and it displays diminishing returns as its effect is largest for low-level IQ countries and smallest for high-level IQ countries. In terms of specific indicators, the level of national governance and the extent of corruption control exhibit the key impacts. In terms of firm-specific controls, indicators of ownership structure and aggregate financial performance are the economically most significant factors associated with increased survival probability of firms in European emerging markets.

This paper provides cross-country macro-economic level evidence on the impact of tourism on house prices based on a panel of 20 OECD countries during the period 1995 to 2014. In its analysis, the study also accounts for institutional quality, banking credit, per capita income and income inequality. We employ Augmented Mean Group (AMG) estimator for the empirical investigation. The findings derived from AMG are robust and reliable as it accounts for cross-sectional dependence and allows for heterogeneous slope coefficients across panel members. The results show that tourism and its interaction with income inequality have a significant positive impact on house prices in the OECD economies. The findings also suggest that the growth in banking credit and per capita income further increases house prices, while institutional quality has the opposite impact. These findings offer new policy insights and practical knowledge.

Despite increasing financial pressures on higher education systems throughout the world, many governments remain resolutely opposed to the introduction of tuition fees, and some countries and states where tuition fees have been long established are now reconsidering free higher education. This paper examines the consequences of charging tuition fees on university enrolments, equity, and proxies for institutional quality. To do so, we study the English higher education system which has, in just two decades, moved from a free college system to one in which tuition fees are among the highest in the world. Our findings suggest that England's shift has resulted in increased funding per head and rising enrolments, with no apparent widening of the participation gap between advantaged and disadvantaged students. The role of fees is moderated by other key features of higher education finance which may differ across countries: in contrast to other systems with high tuition fees, the English system is distinct in that its income-contingent loan system ensures that no tuition fees are paid upfront, and provides students with comparatively generous assistance for living expenses. Still, the English experience provides an instructive case for other countries considering implementing or abolishing tuition fees.

In light of the SDGs background launched by the UN organization, this article aims to examine the Resource Curse and the environmental issues for 26 African countries over the time span from 1990 to 2016. We estimate the RCH and EKC models by applying two recent methodologies which called panel FMOLS and DOLS, and the Granger causality test founded on the panel VECM is applied to detect the causality direction. The results point out the existence of a long-run equilibrium relationship between all variables in the RCH and the EKC model. Moreover, the coefficient on the lagged ECT reveals the presence of a long-run relationship between the variables for RCH for EKC. The highlights pointed out the presence of bi-directional Granger causality among all variables. Our highlights verified well the RCH and EKC hypothesis. Our empirical insights have a set of implications for managing the linkages among these key specifications. The crucial role played by institutional quality over time may help African countries to mitigate the adverse effect of the resources' abundance curse and environmental degradation to achieve the SDGs.

This paper investigates the effects of institutional quality on firms' capital structure for a panel of 3891 firms from 23 developing countries. Our main findings for the full panel show institutional quality has a significantly positive effect on firms' capital structure. At the regional level, based on the panel data for 2187 firms from Asian countries and 1091 firms from Latin American and Eastern European countries, institutional quality has a significantly positive effect on capital structure. However, for the 613 firms from African countries, institutional quality is mostly insignificant. Additional analysis reveals positive effects of legal enforcement on capital structure.

A structured approach to hemorrhagic emergencies in obstetrics has gained popularity with the implementation of massive hemorrhage protocols. The trauma literature suggests that routine quality reviews should be in place to improve patient outcomes. The aim of this study was to develop quality indicators and assess compliance by the clinical team.A multidisciplinary team set the institutional quality indicators for the massive hemorrhage protocol review. A retrospective review of all obstetrical massive hemorrhage protocol activation events from September 2010 to January 2015 was performed. All protocol events occurred before the creation of the quality indicators. Data were retrieved from patient records.There were 17 (0.09%) protocol activations for 19 790 deliveries during the study period. All 17 (100%) patients received at least one unit of red blood cells. Overactivation, defined as the transfusion of2 units of red blood cells, occurred in two cases (12%). Common causes of non-compliance were: 24% (4/17) temperature monitoring, 18% (3/17) lactate measurement, 41% (7/17) arterial blood gas sampling, and 18% (3/17) hemoglobin maintenance within the target range of 55-95 g/L. Admission to intensive care and peripartum hysterectomy occurred in 12 and 5 cases (71% and 29%), respectively.Suboptimal compliance was found in multiple areas, which may be attributable to the low frequency of activation of our massive haemorrhage protocol in obstetrics. The quality targets identified in this report can act as a basis for other institutions developing quality indicators to evaluate performance.

This paper uses a new database on trade aid to examine the relationships among trade aid, institutional quality, and trade. Using an instrumental variable approach and a large country sample, I find that trade aid has significantly higher positive effect on trade when it is interacted with the measure of institutional quality. This result is robust to various model specifications, tackling potential endogeneity issues, and excluding outliers. This finding provides key insights on policy recommendations for policymakers and donors Refereed/Peer-reviewed

By using GMM estimators for unbalanced panel data, we examine the effects of institutional quality, trade openness, and FDI flows on innovation in 84 countries for the period between 1996 and 2014. Our results show that, although institutional quality appears as a vital driver for patent applications, FDI flows and trade openness have different influences. Precisely, higher inward FDI flows have a positive effect on the number of patents whereas trade openness might have a negative one. We afterwards discuss the influence of institutional quality on these two effects by showing that the effects of economic openness are enhanced by the improvement of institutional quality. These results are important for policy makers in setting-up the short-run and long-run policies to sustain economic growth.

This paper revisits the ambiguous natural resource rent and finance nexus in the context of the United States, incorporating the vital role of institutional quality in this paradigm. The literature on the subject matter lacks consensus and overlooks the institutional framework. The study utilizes a unique data set by the International Monetary Fund (IMF), considered the most comprehensive measure of financial development. Our findings based on a robust cointegration approach conclusively confirm that institutional quality is a significant prerequisite to financial development in the United States. The natural resource rent affects financial development negatively when we include proper controls in the estimation. However, we find that institutional quality moderates the natural resource rent and finance nexus. We recommend that policymakers and researchers consider the importance of institutions to come up with realistic estimations and policy inputs.

We use a hand-collected dataset of firm-level foreign direct investment in China to examine the impact of home countries' institutional elements on the investment comovement between foreign and domestic firms. We find that foreign firms from countries with well-developed financial markets or a strong rule of law experience less comovement with Chinese domestic firms. Our evidence also suggests a contingency impact between the two channels of home country institutions; the capital markets effect exists only for foreign firms from countries with strong rule of law, whereas the rule-of-law effect holds only for firms from countries with well-developed financial markets. Finally, we show that firms from countries with better institutional quality exhibit greater investment efficiency than firms from countries with weaker institutions.

Institutional environment of a country plays an important role for innovation activities. Our results confirm that external environment of emerging countries influence the R&D investment. Using Generalized Method of Moments (GMM) estimation of panel data for 664 firms from selected 20 emerging markets during the period of 2006-2013, we find that institutional quality has significant impact on R&D investment. The results show that government effectiveness, rule of law, and regularity quality have positive impact, while corruption and political instability have negative impact on R&D investment in the emerging markets. We also performed elasticity test to compare among the institutional factors. The results show that among the institutional determinants, corruption of a particular emerging country is found to be most important in influencing R&D investment followed by regularity quality, government effectiveness, rule of law, and political instability. These results would be helpful to investors and policy makers to assess the requirements of sustainable development. The results of this study clearly demonstrate that to attract more R&D investment as a source of sustainable development, government should ensure a sound and stable institutional environment along with strengthening other firm level factors as institutional factors are more important to explain the variation over the time and also cost effective in terms of implementation.\ud \ud Key Words: Institutional settings, Determinants, R&D investment, Emerging markets, GMM estimation

This paper investigates whether foreign aid volatility affects economic growth in countries with an effective institution. Specifically, we examine the role of institutional quality in aid volatility-growth nexus using data from 45 Sub-Saharan African countries over the period 1980–2017. We account for different aid types, namely, aid commitment and aid disbursement. Our results show that, unlike foreign aid disbursement, foreign aid commitment is growth-enhancing, but aid volatility adversely impacts on economic growth. We find that although institutional quality and its sub-dimensions enhances economic growth, it fails to curtail the adverse effect of aid volatility on economic growth. With regard to aid flows, aid benefits a country only if the donor commits to provide the aid to the recipient country. Exploiting aid flows’ policy implication, the paper further uncovers that promoting an effective institution could enhance aid effectiveness in Sub-Saharan Africa.

The European integration process started with the aim of reducing the differences in income and/or living standards between the participating countries over time. To achieve this, a certain alignment of institutions and structures was seen as a necessary precondition. While the goal of this income and institutional convergence was successfully achieved over a long period of time, this convergence development has weakened or even turned into divergence in the last one to two decades. This paper provides an overview of the empirical evidence for these convergence and divergence developments and develops policy implications (the challenges and possible ways out).

We show that, contrary to popular belief, capital markets do not drive short-termism. By comparing public and private European firms in countries with different institutional infrastructures, we show that being listed in the stock market plays a positive role in a firm’s investment policies, which is inconsistent with the notion of short-termism. Additionally, the degree to which public markets encourage investment varies positively with countries’ institutional quality. We reconcile the differences between our findings and large sample U.S. results by showing that highly leveraged firms are over-represented in Sageworks’ U.S. private firm data.

This paper examines how pre-crisis conditions affect the duration of different types of financial crises using a data sample of 244 financial crises in 89 countries over the period 1985-2017. Results from our parametric survival analysis show that the duration of any type of financial crisis is longer for countries having higher levels of public debt prior to financial crises, whereas it is shorter for countries characterised by higher pre-crisis levels of (i) current account balance, (ii) international reserves, and (iii) institutional quality. Similarly, while pegged exchange rate regimes are associated with a longer duration of financial crises, majority governments help countries emerge faster from crises. Moreover, banking and currency crises tend to be more prolonged when preceded by higher credit growth. We also find a positive effect of pre-crisis fiscal balance on the probability of crisis ending, and it is noteworthy that this effect is strengthened under majority governments and a stronger institutional environment. Finally, our duration dependence analysis suggests that banking, currency, and twin and triple crises are more likely to end when they grow older.

We analyze the impact of audit committee effectiveness on bank stability. By focusing on audit committee structure, the study reveals that smaller audit committees with more independent members can enhance bank stability. This indicates that audit committee effectiveness is positively related to bank stability. We further find that audit committee effectiveness principally drives bank stability higher through the reallocation effect for profits and incentives to hold higher capital ratios. Moreover, the relationship between bank stability and audit committee effectiveness depends critically on the health of each bank and the institutional quality of each country.

This study analyzes financial inclusion and bank ownership structure's macro impact, using data from 44 developing countries over 2004-2017. Although foreign bank participation enhances the banking sector's efficiency, the benefits decline with circumscribed and exclusory intermediation, resulting in reduced per capita GDP and output growth. Use of and access to financial services and products, including ATMs availability and depositor accounts, positively impact economic performance. To positively impact the economy, financial inclusion and bank ownership require a minimum level of institutional quality.

This paper contributes to the literature on emerging multinational enterprises (EMNEs) by revealing how the conditions in their home countries influence their cross-border acquisitions. The study focuses on the liability of emergingness (LOE). It develops an integrative theoretical framework based on neo-institutional theory and the concept of legitimacy to explain the relationship between LOE and EMNEs’ cross-border acquisitions completion and the situational conditions that shape this relationship. The study uses data on 27,648 announced acquisitions conducted by EMNEs from 24 emerging economies in 175 host countries to estimate the relationships. The results reveal that, while two types of LOE (economic and institutional) have negative impacts on cross-border acquisition completion, the negative impacts become less important or disappear when the host country’s unemployment rate is too high, and the host country’s institutional quality is too low. This finding suggests that EMNEs can mitigate the negative effect of the LOE by carefully choosing a good time and a suitable location to enter into these transactions.

This paper examines the impact of cyber risks on ventures’ initial coin offerings (ICOs) results. We match novel data on national cyber-security with hand collected characteristics of 1,654 ICO projects and discover that cyber risks are negatively associated ICO success. We further find that institutional quality, such as the protection of investor rights and the function of the legal system, attenuates this relationship.

We explore the links between financial markets, institutional quality and economic growth. We document that the unconditional effect of finance on growth is ambiguous. This variation is caused by regional bloc, income level and legal origin differences. Our results suggest that, for financial development (banking sector, insurance sector, stock market) to elicit positive effect on growth, there needs to be an effective institutional framework in place. However, in cases where finance in itself elicits positive effect on growth, further tightening of the institutional framework could be harmful to growth; hence, must be done with caution. Policy implications are discussed.

This study examines the spillover effects of home country institutional and cultural characteristics on the subsidiaries operating in France while they are in the process of making capital structure choices and debt maturity choices. We document that while subsidiaries financing choices are partially explained by standard determinants, at the same time, these choices are impacted by cultural distance factors such as economic, financial, and political distance. Namely, cultural distance is one of the essential determinants of the long-term debt proportion in the total amount of debt used for the financing of foreign subsidiaries in France.

Broadly speaking, institutional reformers decide about the sequencing of types of reforms, either addressing institutional quality or macroeconomic stability. This paper develops a dynamic population game, in which agents play a simple anonymous-exchange game of cooperating or defecting. Agents switch to the strategy with higher expected payoff. Reformers can affect the payoff structure of the stage game in order to maximize the number of cooperators in the population by either enacting legal reform or focusing on the macro outlook of the economy. Reform is cumulative and starts from initial conditions. Reform effort per period of time is capped. On the basis of the theoretical model the paper makes predictions under which conditions which types of reforms should be enacted first and under which conditions reform will not be successful.

This paper is the first to provide firm-level evidence of the effect of capital account liberalization on firms’ total factor productivity (TFP) growth. We find that a one standard deviation increase in capital account liberalization is significantly associated with 0.16 to 0.17 standard deviations increase of the firms’ total factor productivity growth rates. The productivity-enhancing effects are stronger for sectors with higher external financial dependence and capital-skill complementarity and are persistent in the six-year post-liberalization window. Moreover, we show that the transmission mechanisms could be improved financing conditions, technology upgrades, and more use of skilled labor. The direction and asset category of capital account liberalization matter. Additionally, heterogeneous effects exist across firms and countries based on their foreign bank relationship, size, tradability, institutional quality, and economic development.

Louisiana consistently ranks as one of the most corrupt states in the nation. In fact, the Pelican State is the most corrupt state when looking at the most common indicator of corruption: corruption convictions per 100,000. What is less clear about Louisiana is how the state became corrupt. This paper seeks to provide the missing link. I argue that the high levels of corruption in the state can be explained by its origins in French civil law. This historical influence has perverse and persistent effects on the state, despite occurring over 200 years ago. Through these origins in civil law, corruption in Louisiana impacts its economic institutions. These institutions then lead to a variety of other bad outcomes in the state such as a high dependency on oil and low incomes. This argument implies that resource dependency is bad for development only when institutional quality is low. By linking legal origins to corruption, institutions, and economic outcomes, I seek to offer a clearer explanation for why Louisiana sets itself apart from other states in its politically corrupt environment.

We employ matching methods to explore the relationships between foreign aid flows and corruption in recipient countries. Data are drawn from recipients of foreign aid for the 1996 to 2013 period. We find no compelling evidence of an effect running from corruption to aid flows. Furthermore, point estimates imply that corruption reforms lead countries to receive less aid. Alternatively, we generally find that, over a 10-year horizon, a sustained increase in aid leads to more corruption in a recipient. It is the sustained nature of an aid increase that seems to be important for this effect. (We generally do not report significant results for large changes in aid that are not sustained over time.)

We provide evidence for a specific challenge in the design of macroprudential policy, namely political interference. Using panel data from 80 countries over the period of 1990-2016, we uncover the electoral cycles in macroprudential policy. We show that a loosening in macroprudential policy becomes more likely in the pre-election year, especially in countries with lower institutional quality. There is no evidence for the reversal of such actions in the post-election year. We also find that capital account openness, the history of macroprudential policy actions and inflation matter in the electoral cycles in macroprudential policy, in addition to institutional quality. The electoral cycles are found to be stronger in countries that are financially less open, that relied less on macroprudential policy in the past, and that have lower inflation.

We study the link between a country’s institutional quality in tax collection and its optimal corporate tax policies in a model of heterogeneous multinationals that can shift income using both debt and transfer prices. Countries with weak institutional quality can be made worse off adopting policies that attract FDI as the benefits from higher wages and production are more than offset by tax base erosion. Countries with moderate institutional quality can gain from under-utilizing their ability to collect taxes, since the benefit of attracting more FDI outstrips the benefit of increased tax revenue. Countries with very strong institutions benefit from FDI and should utilize their full ability to collect taxes.

Early non-pharmaceutical interventions (NPI) significantly reduced the death toll of the COVID-19 pandemic. Yet, there are vast differences in how quickly governments implemented NPIs. In this paper, we analyze the role of public attention, measured as the share of daily Google searches in a country related to COVID-19, in the timing of the NPI responses. We first show that public attention depends strongly on whether there are cases in own country. We then show that countries with high levels of public attention are more likely to implement NPIs, even after controlling for the number of cases and deaths. Finally, we show that the extent to which a government responds to public attention is highly dependent on the country's institutional quality. The positive effect of public attention on policy implementation is driven entirely by countries with good institutions.

There is substantial evidence on the effectiveness of short-time work on reducing unemployment. However, no study looks at its role during natural disasters. This article exploits the exogenous nature of the 2013 European floods to assess if the impact depends on the quality of the short-time work mechanism across affected counties. We use regression discontinuity designs to show that unemployment does not increase in regions with robust programs while rising up to seventeen percent in areas with less robust mechanisms. Our results are relevant to the literature on how institutional quality influences recovery and suggests that short-time work programs are useful against unforeseeable productivity shocks besides financial crises.

This paper explores the association between rural electrification and agricultural output at the macro level using panel data on 43 Sub-Saharan African countries from 1990 to 2016. We employed Fully Modified Ordinary Least Squares (FMOLS) with time trend and country fixed effect in our econometrics estimation to address the potential serial correlation. Our study investigates the following; i) the association between rural electrification and agricultural output, measured as agricultural output per GDP and agricultural output per worker, ii) whether the relationship between rural electrification and agricultural output is conditional on institutional quality of a country, and iii) whether electrification enhances the marginal effect of factor inputs. We find a positive significant association between rural electrification and agricultural output. Also, our result shows that the relationship between electrification and agricultural output is conditional on the quality of institution and factor inputs of a country. With the exception of capital, the association between the interaction term of rural electrification and factor inputs (labour and land), and agricultural output is negative. However, we find a higher positive direct relationship between labour and agricultural output per GDP, implying a higher productivity for those labour who remain in the sector. Our results are heterogenous across population size quartiles sub-samples. Validerad;2022;Nivå 2;2022-01-03 (johcin)

Using a novel and comprehensive dataset, we find that the deal values of cross-border private equity-backed leveraged buyouts are significantly larger than domestic ones, but after controlling for the effects of diseconomies of scale, the performance of cross-border deals is not significantly different from domestic deals. We identify three channels to enhance cross-border leveraged buyout performance: more deal experience of the private equity sponsor, reduced communication costs, and spillover effects of institutional quality from the sponsor country to the target.

This is the first attempt to examine empirically the effects of the implementation of digital public services (DPS) on the value of trade in green goods (TGG). By applying diverse econometric techniques to a sample of 25 European economies for the period 2012-2019, the results show that DPS captured by three indices (user-centricity, business mobility, and key enabler) has a modest influence on the level of TGG. The results are robust. A higher level of DPS implementation appears to drive up the export value of green goods, and there is evidence of the long-term cointegration of DPS and TGG. Furthermore, the nexus between DPS and TGG is evident in two subsamples of developing and developed economies, but the importance of DPS is more pronounced in the former. Finally, the effects of DPS on TGG value become more significant in the European economies with a well-developed institutional system.