Privredni rast i demokratske institucije u zemljama u tranziciji

Abstract

Using panel for 25 countries in transition for the period 1989-1999, we are analyzing variables that are influencing economic growth. Our paper confirms well-known effects of macroeconomic stabilization, initial conditions and reforms on growth, as well as the better explanatory power of reforms comparing the institutional variables. We have determined the dynamics of initial conditions influences, and shown that their effect had vanished in 1998. This explains the fact that most of those countries are under the level of 1989 GDP. Paper shows indirect relationship between growth and democracy through the reforms. Higher level of democratization will provide more reforms, which in the end is positively affecting growth. Net effect of democracy, i.e. political rights and civil liberties, is positive. However, this is the case only for those countries which have sufficient level of reforms and have started creation of economic institutions. In the case when there was only a political transition, there was no guarantee that this transition would help country to faster escape from the transitional shock, but just an opposite, without reforms and economic institution it will negatively influence on GDP.