Global Insights and Explanations
Global Development Network series
Edited by Gary McMahon, Hadi Salehi Esfahani and Lyn Squire
Gobind Nankani The Global Development Network (GDN) has developed an interesting product – Global Research Projects – which brings together researchers from developing countries to work on issues of wide interest. The present volume summarizes additional findings of GDN’s very first Global Research Project, whose topic – Explaining Growth – has once again become a major area of research for economists all over the world. It is a matter of great pride that GDN initiated work on this topic well before its resurgence as an active research field, and more significantly, that the fundamental conclusions drawn from the GDN project foreshadowed those which have emerged from recent work such as that of the Growth Commission. The fundamental conclusion from the Explaining Growth project is that understanding growth requires analysis of the specifics of the country’s context, and that it is futile to seek to identify a unique set of determinants. It stresses the critical importance of sound macroeconomic fundamentals, and argues that the important functions of many institutions – such as contract enforcement, open markets, and so on – can be provided by varying institutional forms. The lack of a one-to-one relationship between institutional outcomes and institutional forms has been stressed in the literature by Rodrik (2005), and subsequently by the World Bank (2005) and Zagha, Nankani and Gill (2006), and most recently by the Independent Growth Commission (2008) led by Nobel Laureate Michael Spence. Thus, many of the growth successes of East Asia, and most recently of China and India, have used varying approaches to...