The Political Economy of Growth and Governance

This paper provides a framework within which to think about the political economy of growth. It summarizes the five key factors: good government, with secure political conditions; credible macroeconomic stability; savings and investment high enough to sustain adequate growth; openness to the world economy; and the discipline of external engagement. The author argues that the growth model needs to be underpinned by suitable governance arrangements and suggests that good governance has two main elements, each quite complex in practice: protection of property rights; and accountability of government.

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