The Geographic Dimensions of Growth and Development

Samyukta Bhupatiraju, UNU-MERIT

This thesis studies the relationship between institutional quality, geographic endowments and the economic performance of countries in light of the socio-spatial interactions of each of these phenomena. A brief look at the world map shows clusters of countries based on various economic or social definitions. These clusters occur due to various spatially correlated attributes. One such attribute is geographic endowments of countries such as climatic conditions and disease environments. A less obvious spatial correlation exists between institutional structures and quality of countries. This could be due to shared historical experiences or similar cultural traits. In this dissertation, we account for and study the spatial influences between countries, while understanding the links between economic performance, geography and institutions with in a country. The results show that the way each of these three phenomena are defined affects the way they are related/correlated to each other, and yet it is important to acknowledge and account for across the border influences in understanding their within country measures.
Institutional quality as an aggregate measure is important to understand other aggregated variables. Institutions could however be perceived in different ways at the micro/individual level, which may get lost in aggregation. This thesis also studies the impact on institutional quality as measured by firm perceptions together with country level perceptions along with other economic measures to understand how inward FDI is influenced. The aim is to account for scale aspects of institutions even within countries. Results show that FDI inflows into a country are largely influenced by firm idiosyncratic factors and partially on the general macroeconomic conditions and hardly so on the institutional environment of host countries.

Venue: Aula, Minderbroedersberg 4-6, Maastricht

Date: 25 November 2014

Time: 16:00 - 17:30  CEST