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Institutions and Economic Performance in Mexican States

Sonora, Robert (2014): Institutions and Economic Performance in Mexican States.

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Abstract

This paper investigates the relationship between institutional quality and economic performance the 32 Mexican states over the period 2003 -- 2010. Using dynamic panel GMM estimation and the Fraser Institutes index of economic freedom, I find that freedom has an ambiguous impact on economic growth and improvements undermines employment. These results are corroborated with dynamic OLS model and panel fixed and random effects models.

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