The Impact Of Tnstitutional Quality On Promoting Economie Growth In Selected Maghreb Countries
Keywords:
institutional quality, economic growth, Maghreb countries, panel data analysisAbstract
This study examines the impact of institutional quality on economic growth in three selected Maghreb countries namely Algeria, Morocco and Tunisia over the period 1996-20 Il , through the use of panel data analysis. The initial findings indicate that the institutional quality, as measured by the mean of six governance indicators, has a positive impact on economic growth in selected Maghreb countries. Also, there is a significant positive relationship between economic freedom and economic growth at the 1% significance level; hence this factor seems to be the key determinant of economic growth in the sample of countries under study. Moreover, the empirical results show that among the six components of institutional quality, Regulatory Quality (RQ) and Government Effectiveness (GE) have a positive and highly significant effect on annual GDP growth. These findings support the view that good institutions spur faster economic growth Therefore, these countries should improve their institutional quality depending on local knowledge, and experimentation, because the sound institutional environment can face any potential political and economic problems, thus it is able to realize the economic prosperity.
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