Governance Quality and Economic Growth Dynamics
Summary
Governance quality shapes the institutional foundations on which economic growth unfolds, influencing policy credibility, resource allocation, and investor confidence. High-quality governance—embodying effective regulation, rule of law, and accountability—can foster innovation, human capital accumulation and sustainable public investment, while low-quality governance often exacerbates corruption, market distortions and volatility. The dynamics of growth and governance are bidirectional: economic expansion can provide the fiscal space and social demand for institutional reform, whereas robust institutions underpin resilient, long-run development. Contemporary research highlights regional heterogeneity, digitalisation and multilevel governance as key modifiers of this relationship, and employs methods from dynamic panel estimation to spatial econometrics to trace cross-border spillovers. Policy frameworks that strengthen legal systems, enhance bureaucratic capacity and promote inclusive oversight are shown to accelerate growth trajectories and increase resilience in both advanced and emerging economies.
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Governance Quality and Economic Growth Dynamics publication trend
The graph below shows the total number of articles in governance quality and economic growth dynamics across all publications each year (not limited to Nature Index journals).
Technical terms
Institutional Quality: Composite measure of government effectiveness, rule of law, regulatory quality and control of corruption.
World Governance Indicators (WGI): Six aggregate metrics by the World Bank covering voice and accountability, political stability, government effectiveness, regulatory quality, rule of law and control of corruption.
Panel Data Analysis: Econometric approach that analyses observations on multiple entities over time to account for unobserved heterogeneity.
Spatial Dependence: Condition in which economic outcomes in one region are affected by those in neighbouring areas.
References
- Leveraging the potential of artificial intelligence (AI) in exploring the interplay among tax revenue, institutional quality, and economic growth in the G-7 countries. AI & SOCIETY (2024).
- The impact of governance structures on economic growth in Africa: a panel data analysis of 47 African countries. Technological and Economic Development of Economy (2023).
- The Bidirectional Causality between Country-Level Governance, Economic Growth and Sustainable Development: A Cross-Country Data Analysis. Sustainability (2018).
- The impact of governance on economic growth: spatial econometric approach. Review of Economics and Political Science (2022).
- The effect of governance quality on future economic growth: an analysis and comparison of emerging market and developed economies. SN Business & Economics (2023).
- Indicadores de governança mundial e sua relação com os indicadores socioeconômicos dos países do Brics. Revista de Administração Pública (2016).
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