Institutional Quality and Economic Performance in West Africa

Iheonu, Chimere and Ihedimma, Godfrey and Onwuanaku, Chigozie (2017): Institutional Quality and Economic Performance in West Africa.

Abstract

This study empirically accessed the impact of institutional quality on economic performance in West Africa. The study employed the control of corruption, government effectiveness, regulatory quality and rule of law as institutional quality indicators as provided by the World Governance Indicators, WGI (2017). A panel data set of 12 West African countries from 1996 to 2015 was estimated using the fixed effect model, the random effect model and the panel two-stage least square technique. The result showed that all the indicators of institutional quality employed in the study have positive and significant impact on economic performance in West Africa when the fixed and random effect model estimation technique was employed but only government effectiveness was significant after taking account of endogeneity using the panel two-stage least square technique. The study concludes that economic performance in West Africa would be enhanced in the presence of improved institutions with more consideration to government effectiveness.

• Item Type: MPRA Paper
• Language: English
• Keywords: Institutional Quality, Economic Performance, Panel Data Analysis, West Africa
• Subjects: A - General Economics and Teaching > A1 - General Economics > A12 - Relation of Economics to Other Disciplines; B - History of Economic Thought, Methodology, and Heterodox Approaches > B4 - Economic Methodology > B41 - Economic Methodology; B - History of Economic Thought, Methodology, and Heterodox Approaches > B5 - Current Heterodox Approaches > B52 - Institutional ; Evolutionary; C - Mathematical and Quantitative Methods > C0 - General > C01 - Econometrics; C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C13 - Estimation: General

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