Found 2 article(s) for author 'Global'

Are economic rents good for development? Evidence from the manufacturing sector

Are economic rents good for development? Evidence from the manufacturing sector.¬†Eric Werker, December 2018, Paper, “Are rents, or excess profits, good for development? Rents could induce firms to lobby or bribe governments to preserve the status quo; on the other hand, rents may promote growth by giving firms the needed funds to make investments in fixed capital or research and development. To test this question empirically, we use a panel of manufacturing data at the industry-country-year level, and measure rents by the mark-up ratio. We find that the relationship between rents and growth is strongly negative, with the results being primarily driven by the poorer countries (or those with worse institutions) in the sample.Link

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