PROPERTY-RIGHTS, DEMOCRACY AND ECONOMIC-GROWTH

In attempting to identify institutional factors that influence a natio n's per capita growth rate scholarship in political science has focuse d almost exclusively on differences in political regimes. This article argues that if we are interested in understanding why some nations gr ow faster than others, then we must redirect our inquiry and focus on property rights. Using new measures for property rights protection and democracy, and building on an endogenous growth model, this study pre sents the first approximation of the relationship between property rig hts, democracy, and economic growth. These relationships are tested us ing cross-national panel data from 1960-90. The evidence supports two conclusions: (1) economies of nations that protect property rights gro w more rapidly than those of nations that do not protect property righ ts; and (2) the nature of a political regime influences economic growt h indirectly through its commitment to property rights.