Abstract

This research project examines the hypothesis that democracy and political stability have significant effects on economic growth in developing countries. Previous empirical studies find rather ambiguous results when testing for the relationship between democracy and growth. This paper extends these past studies by focusing on the effects of democracy and political stability in developing countries. It also attempts to differentiate the effects of political stability and democracy on economic growth. The results suggest that democracy has a negative effect on economic growth. However the results also suggest that political stability regardless of the level of democracy has the greatest effect on a countries economic growth.

Disciplines

Economics

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Economics Commons

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