Essays in Empirical Institutional Analysis

Sammanfattning: This thesis consists of three empirical studies on the effects of institutions, broadly conceived, on economic outcomes. The first study tests for evidence of causal relationships between provincial quality of governance and economic growth rates in reform-era China, 1985–2005. Improvements in governance are found to be significantly predicted by lagged economic growth rates, while economic growth is not found to be predicted by improvements in quality of governance. At the sectoral level, the effect of growth on governance is strongly driven by growth in the secondary sector, while governance is found to have a negative effect on growth in the primary sector, and a positive, but inconsistent, effect on growth in the tertiary sector. The second study tests the effect of historically-determined regional culture on regional variation in private entrepreneurship during China’s economic liberalization. Provincial success in imperial exams during the Ming dynasty (1368–1644)—which required many of the same personality traits as private entrepreneurship today—is used as a proxy for the historical distribution of these entrepreneurial traits, capturing regional variation in cultural values conducive to entrepreneurship. Controlling for a variety of geographic, economic, and policy factors, this historical cultural variation is shown to be significantly associated with entrepreneurial activity in modern times. The third study investigates the offshoring of pollution-intensive production as a response to increasingly stringent regulation of greenhouse gas emissions. Using annual multi-regional input-output tables, and matched carbon dioxide emissions data, for 40 countries over the period 1995–2009, this study shows that observed increases in the greenhouse gas emissions embodied in imports in developed countries—previously linked to offshoring of pollution-intensive production by firms facing stricter domestic regulations—have instead been driven purely by overall growth in trade and increasing export production in relatively emissions-intensive developing countries. Changes in sector composition are, in fact, shown to have actually decreased emissions embodied in imports.