Institutional quality and economic growth: Evidence from South-Asian countries

The current study investigates the relationship between institutional quality and economic growth, focusing on South-Asian countries entailing Bangladesh, Bhutan, India, Nepal, Pakistan, and Sri Lanka, from 2002 to 2018. The data are analysed using the dynamic heterogeneous panel (panel autoregressive distributed lag [ARDL] model) approach, specifically the dynamic fixed effect (DFE), mean group (MG), and pooled mean group (PMG). Based on the findings, the three governance indicators, namely corruption control, accountability, and the rule of law, positively and significantly affect economic growth. All the nations have consistent long-run estimates but varied short-run estimates and adjustment speed for the long-term equilibrium. This is due to governance volatility that is evident in all the nations. This article offers both practical and theoretical contributions. This article contributes to the institutional quality and economic growth literature from a theoretical perspective from the South-Asian perspective. From a practical perspective, the study findings are significant for policymakers, particularly those from the countries that demonstrate major fiscal and external imbalance due to war and terrorism, low oil prices and weak trade. Hence, there is a pressing need to address economic growth issues instigated by the policymakers' negligence to ensure appropriate governance and macroeconomic management. Regulators can improve economic growth through national and regional image building by developing a stable economic and political landscape and maintaining macroeconomic stability by improving the institutional quality indicators. There is evidence that institutional quality improvement leads to better economic growth.     

State-led bricolage and the extension of collective governance: Hybridity in the Swiss skill formation system

This paper explores the extension of collective governance to sectors without collective governance tradition. We introduce the concept of state-led bricolage to analyze the expansion of the Swiss apprenticeship training system – in which employer associations fulfill core collective governance tasks – to economic sectors in which training had previously followed a school-based and state-oriented logic. In deindustrializing societies, these sectors are key for the survival of collectively governed training systems. Through a mixed-methods analysis, we examine the reform process that led to the creation of new intermediary organizations that enable collective governance in these sectors. In addition, we compare the organizational features of these organizations with the respective organizations in the traditional crafts and industry sectors. We find that the new organizations result from state-led bricolage. They are hybrid organizations that reflect some of the bricoleur's core policy goals and critically build on the combination of associational and state-oriented institutional logics.     

Power transitions and global trade governance: The impact of a rising China on the export credit regime

The existing liberal international economic order was constructed during the era of American hegemony and has been heavily shaped by US power. How is the rise of China affecting global economic governance? This article analyzes the case of export credit, which has long been considered a highly effective international regulatory regime and an important component of global trade governance. I show that the rise of China is profoundly altering the landscape of export credit and undermining its governance arrangements. State-backed export credit is a key tool of China's development strategy, yet I argue that an explosion in China's use of export credit is eroding the efficacy of existing international rules intended to prevent a competitive spiral of state subsidization via export credit. The case of export credit highlights a fundamental tension between liberal institutions of global governance and the development objectives of emerging powers.     

The importance of input and output legitimacy in democratic governance: Evidence from a population-based survey experiment in four West European countries

The study of subjective democratic legitimacy from a citizens’ perspective has become an important strand of research in political science. Echoing the well-known distinction between ‘input-oriented’ and ‘output-oriented’ legitimacy, the scientific debate on this topic has coined two opposed views. Some scholars find that citizens have a strong and intrinsic preference for meaningful participation in collective decision making. But others argue, to the contrary, that citizens prefer ‘stealth democracy’ because they care mainly about the substance of decisions, but much less about the procedures leading to them. In this article, citizens’ preferences regarding democratic governance are explored, focusing on their evaluations of a public policy according to criteria related to various legitimacy dimensions, as well as on the (tense) relationship among them. Data from a population-based conjoint experiment conducted in eight metropolitan areas in France, Germany, Switzerland and the United Kingdom is used. By analysing 5,000 respondents’ preferences for different governance arrangements, which were randomly varied with respect to their input, throughput and output quality as well as their scope of authority, light is shed on the relative importance of different aspects of democratic governance. It is found, first, that output evaluations are the most important driver for citizens’ choice of a governance arrangement; second, consistent positive effects of criteria of input and throughput legitimacy that operate largely independent of output evaluations can be discerned; and third, democratic input, but not democratic throughput, is considered somewhat more important when a governance body holds a high level of formal authority. These findings run counter to a central tenet of the ‘stealth democracy’ argument. While they indeed suggest that political actors and institutions can gain legitimacy primarily through the provision of ‘good output’, citizens’ demand for input and throughput do not seem to be conditioned by the quality of output as advocates of stealth democratic theory suggest. Democratic input and throughput remain important secondary features of democratic governance.     

Effect of foreign direct investment,remittances, and foreign aid on economic growth: Evidence from two emerging South Asian economies

This paper analyzes the effect of foreign direct investment, remittances, and official development assistance on economic growth in India and Sri Lanka. The study uses annual time series data of both countries for the period 1980–2016. In order to find the short‐run and long‐run relationship among the variables, we use Granger causality test and vector error correction model. We also carry out a vector decomposition analysis to predict the forecast variance error of the future periods and impulse response function to analyze the effect of shocks in the independent variables on that of the dependent variable. Our results indicate that foreign direct investment and remittances have a significant impact on economic growth in India, whereas in Sri Lanka, foreign aid and remittances play an important role in enhancing economic growth.     

Schumpeter's economic theory and the dynamic accounting view of the firm: neglected pages from the Theory of Economic Development

Abstract

The first English translation of some of Schumpeter's (1926) pages of the Theory of Economic Development is presented. These neglected pages are remarkable because they significantly add to Schumpeter's masterpiece on a number of issues concerned with accounting, law and economics of the firm. They show that Schumpeter considered understanding the firm, together with innovation, as important scientific problems. Schumpeter doubts the explanatory value of proprietary entrepreneurship and provides an early justification of the dynamic entity view of business activity generated by the firm as a becoming concern. He discusses its implications for understanding issues of economic organization and corporate governance, and suggests some theoretical insights concerning business capital and money under conditions of real dynamics and complexity. The doors opened by Schumpeter indicate that money and accounting are fundamentally coupled as complementary institutions in framing and shaping the economic and monetary process of the firm as an enterprise entity.     

Identifying the Causes of Issue Attention and Policy Change: Evidence from U.S. Offshore Oil and Natural Gas Drilling Policy, 2008

The flow of attention in the policy process is dynamic and disruptive. While we know changes in issue attention often result in policy change, the causal mechanisms underlying the different stages of the attention allocation process remain unclear. This article uses Punctuated Equilibrium Theory to examine an underdeveloped aspect of issue attention within policy‐making institutions: how specific policy indicators influence the entry and exit of issues on policy‐making agendas. Partisan issue attention in the House of Representatives is used to analyze a significant change to U.S. offshore oil and natural gas drilling policy in 2008. The results highlight how historically high gasoline prices precipitated a shift in attention to offshore drilling and subsequent policy change. Moreover, gasoline prices Granger‐cause attention to energy policy in partisan speeches over time. The analysis further reveals how competing policy frames and a salient focusing event shaped congressional and public discourse, leading to subsequent changes in attention. Taken together, the findings broaden our understanding of the policy process by identifying the specific forces behind the entry and exit of issues on the policy‐making agenda.